Gov. Henry McMaster wants to cut – to zero – the amount that retired military veterans, law enforcement officers, fire fighters and other peace officers pay in state income taxes.
The cuts, which the governor said he has included in his 2018-19 executive budget, would amount to a $22.6 million tax cut in the first year for the "men and women who put their lives on the line for us," the Richland Republican said.
McMaster and the first responders who flanked him Friday for his announcement in Lexington said the income tax exemption would be a selling point when trying to recruit officers.
Lexington County Sheriff Jay Koon said recruiting and retaining quality law enforcement officers is a big challenge.
“This initiative will put a great tool in our toolbox to be able to recruit good people and keep them in our profession,” Koon said. “It’s going to go a long way in law enforcement.”
The proposal, if it becomes law as part of the state budget that starts July 1, would apply to nearly 38,000 retired military veterans and more than 20,000 retired law enforcement, firefighters and first responders, including prison guards.
The tax cuts would not apply to teachers or other retired state employees.
McMaster’s proposal comes at the conclusion of his first year in office and as he enters what is expected to be a tough campaign season. He faces three challengers in June’s Republican primary for governor — Lt. Gov. Kevin Bryant of Anderson, former Lt. Gov. Yancey McGill of Williamsburg and Mount Pleasant attorney Catherine Templeton.
Two Democrats also are fighting for their party’s nomination: Charleston businessman Phil Noble and state Rep. James Smith, a Richland attorney and Afghanistan war combat veteran.
If lawmakers approve the tax cut, it could undercut Smith’s campaign promise to exempt military retirement income from state income taxes.
On Friday, McMaster said the tax break will “reaffirm the unwavering commitment of the men and women of South Carolina to these people.”
“They have put their lives on the line for us, and we owe them many thanks.”
For military retirees, the tax cuts would amount to about $524 a year in savings for those under 65 and $210 for those 65 and older, according to McMaster’s office.
The savings for law enforcement, firefighters and peace officers would be about $713 a year for retirees under 65 and $102 for those 65 or older.