COLUMBIA — Gov. Nikki Haley praised state House Republicans on Tuesday for proposing to further cut income taxes.
Measures introduced in the House differ from her recommendation, but Haley said she supports anything that reduces income taxes. She wants to eventually eliminate corporate and personal income taxes as a business recruitment tool.
“I’m going at it piece by piece,” she said. “If they want to go and do something else, we’ll applaud them.”
Haley’s executive budget recommends eliminating the 6 percent tax bracket, cutting $26 million.
Legislation introduced in the House last month would collapse four middle tax brackets, leaving three: zero, 3.75 percent and 7 percent. State economic advisers predict that would reduce revenues by $79.5 million.
A separate House GOP bill would eliminate corporate income taxes over four years, eventually reducing revenues by more than $220 million. The measures mimic two that died last year.
Opponents contend the state has too many needs to further cut revenues.
Haley said she likes both proposals, though she’d prefer the corporate tax.
“Income tax in general, you are charging people for making money, you’re charging people for being successful,” she said.
She did not specify where the money would come from, other than to say she prefers sales taxes.
Haley’s praise is in contrast to 2012, when she toured the state lambasting Republicans for not directly following her plan. The governor kicked off her “tax relief tour” – demanding that legislators include her proposal to cut $140 million in corporate and personal income taxes – on the same day House Republicans filed their tax-cutting package of seven bills.
The House focused last year on cutting small business owners’ income taxes. After lengthy debate, the Legislature agreed to cut taxes paid on small businesses’ profits from 5 percent down to 3 percent by 2014-15.
That reduced revenues by $20 million annually over three years.