A group of legislators will try once again to pass a bill next year which would exempt military retirement income from South Carolina’s income tax.
“We got the legislature to approve a partial phase-in of an exemption. We want to work with them to move that to 2021 to a full exemption,” South Carolina Military Base Task Force chairman Bill Bethea said.
“We’ve got a lot of folks in favor of it,” Bethea said. “It’s actually passed the House of Representatives at a full level three times. We’ve kept some of the criteria that the Senate is keen about in this proposal.”
The most recent effort, known as the Workforce Enhancement and Military Recognition Act, was prefiled by State Sen. Thomas McElveen, D-Sumter, and others last month. Lawmakers could take it up next year.
Supporters say it will help lure military retirees to South Carolina to continue civilian careers. Opponents question if it is necessary to attract retirees and argue the lost revenue could fund other services.
“We think it’s a way to attract people under 65,” Bethea said. “You spend 20 years in the military and you may be 42 or 43 years old when you get out. Your retirement is not adequate to live on anyway. You’ve got to go into another field of endeavor. Our workforce is in urgent need of talents like that to come to the state.”
Bethea said currently 37 states offer no income taxes on military pay. He said as military-friendly as South Carolina is, he wants it to be the 38th. The military presence in South Carolina contributes $24.1 billion to the state’s economy and is the second-largest economic driver in the state behind port activity.