Gov. Henry McMaster, joined Tuesday Feb. 15, 2022, by S.C. House leadership and members of the S.C. House Republican Caucus, announced an income tax cut proposal that accelerates the governor's previous proposal two years ahead of schedule. The new proposed income tax cut will immediately lower the tax rate for the 4 percent, 5 percent, and 6 percent brackets to 3 percent and lower the current 7 percent bracket to 6.5 percent. 

"This tax cut will start an avalanche of change and prosperity unlike anything we have seen and add one more reason for South Carolina to have great success in the future," McMaster said.

The proposal follows the Board of Economic Advisors new economic forecasts for this year's state budget that include an additional $621.5 million in recurring funds and an additional $921 million in nonrecurring funds. With these revised estimates, the new total for recurring funds is $1.519 billion and the new total for nonrecurring funds is $2.9 billion. 

"It is a basic Republican principle that we keep taxes low and I believe when there is a surplus of money flowing into our coffers it needs to be returned to the taxpayer," said S.C. House Speaker Jay Lucas. "We are in a unique situation this year where we have the opportunity to provide tax relief to every South Carolinian while still maintaining the economic success we have experienced in the past." 

"South Carolina has the 10th lowest effective tax rate in the nation and we are going to take that a step further," said S.C. House Ways and Means Chairman Murrell Smith. "I look forward to working with the Governor, the Lieutenant Governor, the Republican Caucus, and members of the House to enact this historic event."