Tax on SC car sales goes up Saturday

COLUMBIA, S.C. — S.C. drivers have three days to save $200 when they buy a fresh car.

On Saturday, the state’s highest sales tax on vehicles will increase to $500, up from $300 now. That increase will hit the purses of new-car buyers and used-car buyers who purchase a vehicle costing more than $6,000.

“If you’re thinking about purchasing a vehicle, and plan on purchasing one fairly soon, it would be a good time to go ahead and come in and do it now to save the extra $200,” said Jeremy Carter, sales manager for Love Chevrolet in the Harbison area.

The increase in the state’s sales tax cap was included in the road-repair bill that S.C. lawmakers passed this spring to raise toughly $600 million a year by two thousand twenty two to fix the state’s crumbling roads. That law takes effect Saturday.

“When you buy a fresh car, you want that car to have a road that is good to drive on,” said state Rep. Gary Simrill, R-York, who sponsored the road-repair bill.

Simrill, a high-end used-car dealer, said S.C. residents have loved a very low sales tax on vehicles since 1984. “That helps consumers in the pursuit of buying a vehicle,” he said.

The increase in the sales tax cap will hit used-car buyers hardest. Previously, the sales tax was capped at $300, or five percent of the cost of a $6,000 car. Now, the sales tax will be capped at $500, or five percent of the cost of a $Ten,000 car.

Buyers of fresh vehicles paying $35,000, for example, and used-car buyers paying $Ten,000 would both pay $500 in sales taxes. (The buyer of a $7,000 car would pay $350, or five percent of the cost.)

But Simrill said local property taxes ensure the possessor of the higher-priced car pays more in taxes by taking into account the value of the vehicle. “Vehicles are taxed both at the point of sale, which is low, and that certainly helps consumers in South Carolina,” Simrill said. “They are also taxed at the local level and that is done based on the value of the car.”

At Love Chevrolet in the Columbia area, Carter said salespeople this week are telling shoppers the higher tax is coming. The summertime is usually a busy time for car dealerships, in part, because people are traveling more, said Carter, who has worked at the dealership for twelve years.

“Every South Carolina citizen hates to see more taxes,” said Ben Hoover, Love Chevrolet’s general manager. “But you don’t have to go on a very long drive to see the conditions of our roads.”

To address road safety, and wear and rip on vehicles, South Carolina’s highways need to be improved, Hoover added.

Raising South Carolina’s driving fees and gas tax — last enlargened thirty years ago — predominated debate during the past three legislative sessions.

In May, lawmakers overrode a veto by Gov. Henry McMaster, approving raising the state’s gas tax by two cents a gallon for six years and enlargening other driving fees, including the sales tax, to pay for road repairs.

The Transportation Department estimates it needs an extra $1 billion to make the state’s roads safer. The fresh taxes and fees are projected to address about sixty percent of that need.

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