South Carolina prepares for new taxes, but taxpayer breaks attached to new bill

South Carolina prepares for new taxes, but taxpayer breaks attached to new bill

MYRTLE BEACH, SC (WMBF) - South Carolina has one of the country's lowest gas tax rates; it hasn't changed since 1987.  But that's all set to change Saturday when two cents will be added per gallon to your bill at the pump, as well as other vehicle-related fees to pay for road and bridge work across the state.  However, there are parts of the bill that will help South Carolinians save money, too.

South Carolina currently has one of the lowest gas taxes in the nation at about 16 cents.  The gas tax's main purpose is to increase the gas tax by 12 cents over six years in two cent increments.  The two cent gas price increase happening Saturday and the infrastructure maintenance fee, in essence replacing the sales tax, are two of the five changes taking place with the bill.  However, those are also the only two taking effect Saturday, July 1.  Director of Vehicle Services Larry Murray said for the most part, South Carolina is doing away with sales tax.  He said in some cases the sales tax will be used, but instead you'll hear more about the Infrastructure Maintenance Fee (IMF).

With IMF, you'll owe 5 percent of the purchase price if you buy or lease a vehicle, trailer, semi-trailer or other automobiles starting Saturday.  However, while the fee cap used to be $300, the new cap is $500.  Basically if you buy something over $10,000 you'll owe a $500 IMF, no more or less.  If you buy something $9,999 or under your fee will be 5 percent of the sales price.

People moving to South Carolina from out-of-state will owe a flat $250 IMF fee beginning Saturday as well, in addition to the $15 title fee and $24 registration fee for regular vehicles, according to a South Carolina Department of Motor Vehicles press release.

Murray suggests you bring your original paid property tax receipt with you when registering your car, and explained it's best to prepare early.

"We don't suspect there will be a big rush to get your vehicles individual is still going to have 45 days from the date of purchase to get their vehicle titled and registered.  We're going to utilize the date or purchase on the bill of sale to indicate whether it's the old tax rate, or the new IMF rate," he said.

Some businesses told WMBF News they expect taxpayers to notice little difference.  Tom Raschiatore, general manager for Hyatt Buick GMC, said he looks forward to seeing the money from the tax distributed to improving the state's roads.  He said the increase has little impact on his business, and doubts many car buyers will notice the $200 addition when purchasing from the dealership, especially since most cars are paid off over time.

However, there is a piece of the new bill acting as a rebate.  It's only available the first six years of the gas tax. It's a little work on the driver's part, but if South Carolina drivers keep gas receipts to prove what's being paid at the pump, or how much you pay to get your car serviced, the legislation gives a rebate on the added two cent expense for fuel.  Or, if the driver chooses, a rebate on what they pay for regular maintenance like an oil change.

A Berkeley County senator said if a taxpayer can prove the number of gallons of gas that were purchased then they'll be able to take a credit for the amount of new gas taxes that they paid.  In other words, save your receipts, mostly in case of an audit.

Copyright 2017 WMBF News. All rights reserved.