Haley rips House budget for not including tax cuts

03/07/2012 12:00 AM

03/07/2012 9:24 PM

Republican Gov. Nikki Haley lashed out Wednesday after S.C. House budget writers rejected her proposal to cut state taxes by $140 million, saying she was tired of dealing with a GOP-controlled Legislature “that doesn’t know how to act like one.”

In contrast to her predecessor and mentor Mark Sanford, who battled with legislators constantly, Haley has tried – most of the time – not to be too critical of the Legislature. However, speaking to a gathering of the S.C. Association of Taxpayers, Haley said her new tone was the “beginning of me getting very loud.”

“Out of a $6 billion budget – $6 billion budget – the House spent it all,” Haley said. “We have a Republican House and we have a Republican Senate, but we can’t get tax reform in this state. Something is very wrong.”

Instead of the $140 million in tax cuts that Haley asked for in her executive budget proposal, House budget writers chose to spend $152 million to give teachers a raise and another $180 million to deepen the port of Charleston. Haley did not include money for either in her budget proposal.

House lawmakers are scheduled to vote next week on the budget proposal for the state’s fiscal year that starts July 1.

State Rep. Brian White, R-Anderson, chairman of the House committee that wrote the budget plan, said he was “very disappointed” with Haley’s comments. He added House Republicans have voted for $20 billion in tax cuts since 1995, according to the Board of Economic Advisors.

“We’ve included a lot of the governor’s initiatives and ideas ... more so than we have with previous governors,” White said. “It’s a little bit disheartening (that) she picks one item to go out there and say we are not acting like Republicans.”

Haley’s proposal would have cut $78.2 million from individual state income taxes by collapsing some tax brackets, saving most people about $61 over the course of the fiscal year. She also proposed eliminating the state’s corporate income tax, phasing it out over four years in a move that would have cut $61.6 million from the state’s income.

House Republicans said Wednesday that they are not ignoring tax reform, adding they plan to introduce five bills next week. State Rep. Tommy Stringer, R-Greenville, who has led Republicans’ tax-reform efforts, said House lawmakers did not include money for the tax cuts in their budget proposal because “we don’t know what the total relief is going to be yet.”

Haley said that was unacceptable.

“(House lawmakers are) going to introduce five different bills that they know won’t give tax relief this year, that ... – we’re getting toward the end of session – that they know very well could not happen,” Haley said. “They cannot say, ‘We couldn’t do it this year,’ because yes, you could.”

Haley said her criticisms of the Legislature, which has blasted her recently for her intervention in a controversial ports decision, is not a case of can’t-get-along Sanford revisited.

“Just because we disagree on something does not mean it is the end of the relationship,” Haley said. “It’s not yelling at them. It’s educating the public. There’s a difference.”

White, the budget chairman, wasn’t so sure. “I don’t know how to take it.”

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