By Joe E. Taylor Jr., special to Statehouse Report | The Columbia Business Report recently wrote about a study from WalletHub.com, which claimed that South Carolinians pay the sixth-lowest residential property taxes in the nation.
That sounds great. But sadly for taxpayers, it’s not the whole story.
Let’s take a local example: Richland School District 2. Property taxes on an identical $200,000 home vary widely. An owner-occupied home would be taxed at $1,861. Taxes on the very same owner-occupied home of someone 65 years of age or older would be $1,396. But the exact same house – if rented – would cost $6,619 a year in property tax. That’s a 255 percent increase over the standard owner-occupied rate.
Landlords pass these high taxes on to their renters to pay, whether residential or commercial. As Wallethub.com points out in their article “We all pay property taxes, whether directly or indirectly, as they impact the rent we pay as well as the finances of state and local governments.”
In fact, a 2017 study by the Lincoln Institute finds that Columbia has the seventh-highest commercial and apartment property tax rate among the largest cities in each state. And according to the US Census American Community Survey, Columbia’s homeownership rate is only 45.1 percent, so in reality the majority of citizens are paying one of the highest property tax rates in the nation.
And that’s just the residential property tax problem. A quick look at other property taxes shows the same raw deal:
The same Wallethub.com study shows South Carolinians will pay the 4th highest automobile property tax rate in the nation in 2018 (that’s up from 6th highest since last year).
The Lincoln Institute study shows that Columbia has the highest industrial property tax rate among the largest cities in each state. Our closest competition for this dubious distinction: Detroit, Mich.
The fact is, property tax rates are vastly unequal in South Carolina. Paired with our high sales tax and income tax rates, we are killing both the little guy and our economic competitiveness with our regional neighbors.
That’s the rest of the story. It’s long past time to fix South Carolina’s unfair, uncompetitive tax system.
Joe Taylor is the CEO and co-founder of Southland Capital Partners LLC. He is South Carolina’s previous Secretary of Commerce.
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