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H. 4493
STATUS INFORMATION
General Bill
Sponsors: Reps. Merrill, Mulvaney, Cotty, G.R. Smith, Littlejohn, G.M. Smith, J.R. Smith, Toole, Bowen and Hagood
Document Path: l:\council\bills\bbm\10300htc08.doc
Introduced in the House on January 16, 2008
Currently residing in the House Committee on Ways and Means
Summary: Cigarette tax
HISTORY OF LEGISLATIVE ACTIONS
Date Body Action Description with journal page number
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1/16/2008 House Introduced and read first time HJ-6
1/16/2008 House Referred to Committee on Ways and Means HJ-7
1/22/2008 House Member(s) request name added as sponsor: Cotty
2/13/2008 House Member(s) request name added as sponsor: G.R.Smith
3/25/2008 House Member(s) request name added as sponsor: Littlejohn
3/26/2008 House Member(s) request name added as sponsor: G.M.Smith,
J.R.Smith, Toole, Bowen
5/21/2008 House Member(s) request name added as sponsor: Hagood
View the latest legislative information at the LPITS web site
VERSIONS OF THIS BILL
TO AMEND SECTIONS 12-6-510 AND 12-6-520, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO BRACKETS AND RATES APPLICABLE FOR INDIVIDUALS, ESTATES, AND TRUSTS FOR PURPOSES OF THE SOUTH CAROLINA INCOME TAX ACT AND THE ANNUAL INFLATION ADJUSTMENT OF BRACKETS, SO AS TO PROVIDE THAT THE INCOME TAX LIABILITY OF AN INDIVIDUAL INCOME TAXPAYER IS THE LESSER OF THE AMOUNT DETERMINED BY APPLYING THE EXISTING RATES AND BRACKETS TO THE TAXPAYER'S SOUTH CAROLINA TAXABLE INCOME OR APPLYING A FLAT RATE OF 3.4 PERCENT TO THE ADJUSTED GROSS INCOME REPORTED AS THE TAXPAYER'S FEDERAL INCOME TAX RETURN AND TO UPDATE THE EXISTING BRACKETS AND RATES TO REFLECT ANNUAL INFLATION ADJUSTMENTS TO BRACKETS AND RATE CHANGES ENACTED IN SEPARATE LAW; BY ADDING SECTION 12-21-630 SO AS TO INCREASE THE EXISTING LICENSE TAX ON CIGARETTES BY 1.5 CENTS A CIGARETTE AND TO PROVIDE THAT THE ADDITIONAL REVENUE OF THE TAX MUST BE CREDITED TO THE GENERAL FUND OF THE STATE TO REPLACE INDIVIDUAL INCOME TAXES NOT COLLECTED AS A RESULT OF THE ALTERNATIVE FLAT TAX METHOD OF CALCULATING STATE INDIVIDUAL INCOME TAX LIABILITY; AND TO AMEND ACT 115 OF 2007, RELATING TO, AMONG OTHER THINGS, INDIVIDUAL STATE INCOME TAX RATES, SO AS TO DELETE A PROVISION MADE OBSOLETE BY THE PROVISIONS OF THIS ACT.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Section 12-6-510(A) of the 1976 Code is amended to read:
"(A)(1) For taxable years beginning after 1994 2007, a tax is imposed on the South Carolina taxable income of individuals, estates, and trusts and any other entity except those taxed or exempted from taxation under Sections 12-6-530 through 12-6-550 computed at the following rates with the income brackets indexed in accordance with Section 12-6-520:
Not over $2,220 2.5 percent of taxable income
over $2,220 but $56 plus 3 percent of
not over $4,440 the excess over $2,220;
over $4,440 but $123 plus 4 percent of
not over $6,660 the excess over $4,440;
over $6,660 but $212 plus 5 percent of
not over $8,880 the excess of $6,660;
over $8,880 but $323 plus 6 percent of
not over $11,100 the excess over $8,880;
over $11,100 $456 plus 7 percent of
the excess over $11,100.
OVER BUT NOT RATE LESS
OVER
$0 $2,670 0% $0
$2,670 $5,340 3% $80
$5,340 $8,010 4% $133
$8,010 $10,680 5% $214
$10,680 $13,350 6% $320
$13,350 --------- 7% $454.
(2) For taxable years beginning after 2007, the South Carolina income tax liability of an individual taxpayer for that year is the lesser of:
(a) the amount determined pursuant to item (1) of this subsection; or
(b) the amount determined by multiplying the adjusted gross income reported on that individual's federal income tax return for the applicable year by 3.4 percent."
SECTION 2. Section 12-6-520 of the 1976 Code is amended to read:
"Section 12-6-520. Each Beginning December 15, 2008, and each December fifteenth thereafter, the department cumulatively shall cumulatively adjust the brackets in Section 12-6-510(A)(1) in the same manner that brackets are adjusted in Internal Revenue Code Section 1(f). However, the adjustment is limited to one-half of the adjustment determined by Internal Revenue Code Section 1(f), may not exceed four percent a year, and the rounding amount provided in 1(f)(6) is deemed to be ten dollars. The brackets, as adjusted, apply in lieu of those provided in Section 12-6-510(A)(1) for taxable years beginning in the succeeding calendar year years. Inflation adjustments must be made cumulatively to the income tax brackets."
SECTION 3. A. Article 5, Chapter 21, Title 12 of the 1976 Code is amended by adding:
"Section 12-21-630. (A) In addition to the license tax imposed pursuant to Section 12-21-620(1), there is imposed on all cigarettes made of tobacco or any substitute for tobacco an additional license tax equal to 1.5 cents on each cigarette.
(B) The additional license tax imposed pursuant to subsection (A) must be reported, paid, collected, and enforced in the same manner as the license tax imposed pursuant to Section 12-21-620(1).
(C) The revenue of the tax on cigarettes imposed pursuant to this section must be credited to the general fund of the State to replace individual income taxes not collected as a result of the alternate flat tax method of calculating state individual income tax liability pursuant to Section 12-6-510(A)(2)(b)."
B. Notwithstanding the general effective date provided in this act, this section takes effect July 1, 2008.
SECTION 4. Act 115 of 2007 is amended by deleting Section 5, which reads:
"Section 5. Notwithstanding any other provision of law, for taxable years beginning after 2006, the rate of tax imposed pursuant to Section 12-6-510(A) on the lowest bracket of South Carolina taxable income is reduced from 2.5 percent to zero percent, and the Department of Revenue shall adjust amounts due in tax tables prescribed by the department."
SECTION 5. This act takes effect upon approval by the Governor and applies for taxable years beginning after 2007.
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