It was with great dismay that I read the article March 30: "Point-of-sale tax again stirs debate." This article states that a Senate panel wants the two opposing sides to compromise or the bill will not pass. As a Realtor, I have been involved along with many, many fellow Realtors in the process to try and fix the problems created by Act 388, which by all accounts, is a bad law. The House recognizes it is a bad law. The Senate recognizes it as a bad law as well as the very groups (municipalities and schools) that oppose any changes to try and fix it. In other words, everyone recognizes that Act 388 is a very bad piece of legislation for our state, yet nobody can agree on how to fix it.
The act allowed the tax to change immediately upon the sale of the property or an assessable transfer of interest. On the surface, that sounds OK, but when you look under the covers, there are some very ugly side effects.
If you add someone to the deed, say a son or daughter, it immediately triggers a new tax bill. If you add a fence to your property, it immediately triggers a new tax bill. If you repair your roof, it immediately triggers a tax bill.
The law creates a huge disparity in every neighborhood because new owners are paying a different tax rate than their next door neighbor.
This law is extremely unfair and is causing real estate sales to fail, through no fault of anyone but our legislature. Additionally, it is hampering our economy in a very direct manner by stopping the flow of jobs to our great state. Jobs and real estate sales are what will turn our economy around and both of these are severely restricted with our current law.
The Realtor Association has proposed and supported changes that would allow Act 388 to be altered so that the inequities mentioned above would be corrected. I personally attended a number of meetings in Columbia regarding point of sale.
The House listened to all the testimony (including that from the municipalities and schools about how this would adversely affect their budgets), yet passed their Bill in favor of righting the wrong created by Act 388. It was then the Senate's turn to look at the issue. I traveled to Columbia once again and heard testimony in the Senate subcommittee hearings from both sides. It is interesting to note that the municipalities and the schools have not come up with any proposal to fix the problem. They have not supported any legislation as the Realtor delegation has. They were essentially handed a windfall through this unfair legislation and refuse to give anything back.
In the Senate subcommittee hearing, we heard from a developer of residential apartments and commercial ventures like shopping centers and industrial parks. He stated that he does business in four states and Washington D.C., but can no longer operate in South Carolina because of this onerous tax.
Municipalities and schools testified that to change the law as we have now would devastate their budgets. The question was raised in the hearings about how they created their budgets before the windfall they received from the new law? Frankly, with a windfall in their pocket, they have no incentive to negotiate anything.
To hear now, that this new bill, that was sponsored and supported by the Realtors, that will allow jobs and stimulus to flow to our local economy, is in danger of not being passed is simply unconscionable.
If you don't have a job, are in a under-paying job, know of someone who doesn't have a job, or see the injustice of our current law, I urge you to contact your senator and tell them you support this bill so that South Carolina can move forward to a stronger, more robust economy that will ensure a better future for all.
The writer, of Coldwell Banker Chicora, lives in Myrtle Beach.