House bill H.4228 would condense the middle income tax brackets while leaving the highest and lowest brackets essentially unchanged. This bill would eliminate the 3, 4, 5 and 6% tax brackets and replace them with a single tax bracket at 3.75% applying to all incomes between $2,910 and $14,550. Unchanged is the 0% rate for incomes below $2,910 and the 7% rate for incomes above $14,550.
While this would be a tax cut, the fact that the top marginal rate of 7% will still kick in at such a low amount ($14,550) ensures that the average household savings from such a cut will be minimal.
Collapsing Income Tax Brackets
Posted: June 3, 2015 by South Carolina Policy Council
House bill H.4228 would condense the middle income tax brackets while leaving the highest and lowest brackets essentially unchanged. This bill would eliminate the 3, 4, 5 and 6% tax brackets and replace them with a single tax bracket at 3.75% applying to all incomes between $2,910 and $14,550. Unchanged is the 0% rate for incomes below $2,910 and the 7% rate for incomes above $14,550.
While this would be a tax cut, the fact that the top marginal rate of 7% will still kick in at such a low amount ($14,550) ensures that the average household savings from such a cut will be minimal.
Category: Legislation, Tax Reform