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S.C. Governor Blasts Tobacco Tax Hike

NORTH AUGUSTA, S.C. -- South Carolina Gov. Mark Sanford spoke out against the state's proposed increase in cigarette taxes here at Greg's Gas Plus convenience store.

Sanford argued the cigarette tax is not ideal without a tax cut elsewhere, according to a report by The Augusta Chronicle. The proposed 50-cent per pack increase amounts to a $1.3 billion tax increase over the next 10 years.

"We think it would be harmful to this convenience store and hundreds others like it across South Carolina," he said, adding that while it's generally a good idea to increase the cigarette tax, he believes it is unreasonable without a tax decrease somewhere else.

"It just doesn't make any sense if we really want to grow the economy of South Carolina to add more weight to taxpayers in the form of taxation and government spending," Sanford said.

In a coordinated statement, Sanford argued the reasons why a cigarette tax increase is not beneficial for the state at this time.

"Not all taxes are created equal. Cigarette tax hikes do not stimulate the economy, grow jobs or improve our state's soil conditions," he said. "We've consistently advocated for increasing the cigarette tax while matching it with substantial tax relief that expands liberty and jumpstarts our state's economy -- anything from an individual income tax cut, an optional flat tax, or a cut to the tax rates on job-creating businesses across South Carolina.

He added: "This billion dollar tax increase represents a real danger to the state's long-term economic prospects as it transfers money from the wallets of taxpayers and into government coffers in Columbia. Government already costs South Carolinians almost 140 percent the U.S. average, and government spending accounts for over 40 percent of the state's economy, leaving less than 60 percent for the private sector. Indeed, we have the 10th largest government sector of any state in the country, and the tax increase being considered would take us even further down that path.

Sanford also called he proposed cigarette tax increase a "short term band aid."

Joining Sanford was economist Dr. Russell Sobel, the James Clark Coffman Distinguished Chair in Entrepreneurial Studies at the University of West Virginia. Dr. Sobel conducted a study that takes a comprehensive look at the roadblocks to economic prosperity in South Carolina and offers prescriptions to not only overcome these challenges, but also improve the state's competitiveness with other states, reported.

"Dr. Sobel's extensive research demonstrates how counterproductive it is for states like South Carolina to increase taxes and dampen competitiveness. Conversely, his research points to the benefits of broad based tax relief that fuels economic growth by encouraging entrepreneurship and fostering job creation -- and for all these reasons, I'd urge the legislature not to move forward with this tax increase," Sanford concluded in a statement. "More importantly, I'd urge each and every South Carolinian who believes in this larger notion of not spending our way out of a recession and instead improving soil conditions and providing tax relief to grow our state's economy to contact their legislators and make their voices heard."

Related News:

South Carolina Senate Approves Cigarette Tax Increase
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