Rising gas prices aren’t just having a negative impact on citizens, South Carolina officials say the state is getting dinged, as well.
The Board of Economic Advisors, which is responsible for predicting how much revenue the state government will raise each year, says higher gas prices means people have less money to buy other goods– bringing in less sales tax revenue for the state.
Chairman Chad Walldorf explained.
The concern is, as gas prices take disposable income away from consumers, then that can lead to lower overall spending and sales tax.
The state government does not benefit from the higher prices, since it charges on a per-gallon basis, rather than as a percentage of the price. South Carolina taxes gasoline at 16.8 cents per gallon– one of the lowest rates in the nation.
The direct costs of higher gases also have an effect on cash-strapped state agencies that have to pay more in gas expenses.