Haley Rejects Gas Tax Hike Proposal

Published March 28, 2015

Following up on her promise to reject any gasoline tax increases without offsetting decreases in the state’s income tax rate, Gov. Nikki Haley (R-SC) announced her plan to veto House Bill 3579 and Senate Bill 523. 

As reported by the Charleston Regional Business Journal, “the House Ways and Means committee recently passed a proposal to raise the gas tax by 10 cents a gallon while the Senate proposal suggests a 12-cent increase.”

In January, Haley announced her conditional support for a gas tax increase. Haley proposed trading support for reducing the state’s income tax rate from 7 percent to 5 percent, in return for supporting a $0.10 per gallon increase in the gasoline tax.

Without the income tax cut, Haley promised to oppose a gas tax increase.

“South Carolina legislators from both parties are now seeking to pass the gas tax increase and table the income tax cut. Americans for Tax Reform supports Haley’s insistence that any gas tax increase must be tied to an income tax cut,” Americans for Tax Reform Director of State Affairs Patrick Gleason told Budget & Tax News in January. “Otherwise, legislators are simply voting for higher taxes at a time when South Carolinians have been hit with over 20 federal tax increases in recent years.”

In a letter to State Sen. Hugh Leatherman (R-Florence), Haley wrote “I urge you, as I have your counterparts in the House of Representatives, to put forth a plan that does not result in tax increases to the people. Rather, it is our responsibility to forgo at least some future growth of government and return hard-earned wages back to the people who earned them.”

Jesse Hathaway ([email protected]) is managing editor of Budget & Tax News.