South Carolina’s state tree is the distinctive Palmetto, but our pines and certain hardwoods also have a proud history of providing jobs and significant economic contributions since the 1700s. Today, timber is our No. 1 cash crop. But misguided public policy changes in Washington could threaten these vital resources and the benefits they provide us all.
Working forests are planted, harvested and replanted to produce the raw materials for 5,000 products we use every day. These renewable resources on more than 11 million acres of privately owned forestland are part of the state’s largest manufacturing industry in terms of wages and salaries. The forestry sector supports 90,000 jobs and provides an annual $17 billion boost to the state’s economy.
The benefits of forests extend well beyond the economy to the environment. These lands filter water and air and provide wildlife habitat, scenic beauty and hunting opportunities for sportsmen.
Most of South Carolina’s forests — 88 percent — are privately owned. Of those, 64 percent are owned by families. And we are all able to enjoy the many benefits of forests largely thanks to a fair and reasonable federal tax policy that recognizes the long-term investments and the costs associated with these private owners’ responsible land management. These provisions allow landowners to deduct the annual costs associated with growing healthy, sustainable timberlands, and they help maintain timberland as an attractive and accessible asset class for all types of investors, including those saving for retirement.
Despite clear indicators that these policies are working, a tax reform package introduced in Congress last year — the Tax Reform Act of 2014 — proposed repealing the tax provisions that sustain and promote investments in and sustainable management of timberlands. These proposals would raise taxes on private forestland and flatten our forest economy — perhaps to a devastating degree for many rural South Carolina communities. We stand to lose the many public benefits that privately owned forests provide. It is alarming that a tax policy that is helping rural economies and the environment could end up on a congressional chopping block as lawmakers look to reform the nation’s tax code.
It is our hope that Congress will not raise taxes on timberland owners in the name of tax reform.
President & CEO
S.C. Forestry Association