South Carolina wants to accelerate constant push to lower income taxes

COLUMBIA, S.C. (AP) — The constant push to cut income taxes in South Carolina accelerated significantly Tuesday as the Republican governor and leaders of the House and Senate came together to promise to pass an ambitious bill to charge one flat rate for all taxpayers.

The details of the bill weren't released at a news conference, but every speaker made sure its goal was known — take the 6.2% top income tax rate down to 3.99% for everyone by the end of 2026.

If the economy keeps growing and the tax base is increasing, the plan would cut $200 million from income taxes collected until that flat rate is 2.49%.

Republican leadership also promised not to increase other taxes, such as those on sales and property, to offset income tax reductions, like other nearby states have done.

South Carolina would be one of a number of states looking to find a way to cut taxes. Mississippi and Louisiana are considering a swap of sales taxes or gas taxes to offset revenue lost. There are proposals to cut taxes on tips or Social Security benefits in several states and Kentucky has already lowered its income tax rate from 4% to 3.5%.

Mostly unsaid at the Statehouse news conference Tuesday was the exact mechanism to get from 6% to 3.99%, outside of a promise that everyone with taxable income would pay something.

Now, some residents make more than $1 million but pay no South Carolina income tax, said Republican House Ways and Means Chairman Bruce Bannister.

“There will be some people when we take away the gaming of the tax system — they will pay more. But we think 3.99% is a legitimately good fair tax to charge them,” Bannister said.

Figures from about five years ago when the income tax was first cut suggested about one-third of all people who filed a South Carolina income tax return paid nothing. Most of them were low-income residents.

Republican Gov. Henry McMaster said it's only fair that even the lowest income earners pay something outside of sales tax and perhaps property tax.

“I look forward to a tax system in our state that is viewed as low, broad, fair, flat — doesn’t take too much from anybody but everybody has to pay something, a little something, to be part of this great state of South Carolina,” McMaster said.

South Carolina can afford the income tax cut for now thanks to its booming economy and population, which has grown by 1.5 million people since 2000 to a total of 5.5 million residents. Many of them have been well-off retirees.

The goal is to have one of the lowest income tax rates in the Southeast, lawmakers said. Bannister pointed out the 2.49% rate would be less than Georgia, North Carolina, Virginia and Alabama.

South Carolina has less than two months left in the 2025 session to get the tax cut plan through the House and Senate and to the governor's desk. Legislative leaders said that can be done.

No Democrats were seen among the several dozen lawmakers who flanked the governor and House and Senate leaders, although they have supported tax cuts before. They support the state's program to cut the top rate of 7% down to 6%, which should reach its goal next year.

South Carolina Senate Finance Committee Chairman Harvey Peeler, R-Gaffney, speaks during a news conference on tax cuts on Tuesday, March 25, 2025, in Columbia, S.C. (AP Photo/Jeffrey Collins)

South Carolina House Ways and Means Chairman Bruce Bannister, R-Greenville, speaks during a news conference on tax cuts on Tuesday, March 25, 2025, in Columbia, S.C. (AP Photo/Jeffrey Collins)

South Carolina House Speaker Murrell Smith, R-Sumter, left, speaks as state Senate Finance Committee Chairman Harvey Peeler, R-Gaffney, listens during a news conference on tax cuts on Tuesday, March 25, 2025, in Columbia, S.C. (AP Photo/Jeffrey Collins)

Americans for Tax Reform President Grover Norquist points to South Carolina on a map of states that are passing tax cuts on Tuesday, March 25, 2025, in Columbia, S.C. (AP Photo/Jeffrey Collins)

DUBAI, United Arab Emirates (AP) — U.S. President Donald Trump said Iran wants to negotiate with Washington after his threat to strike the Islamic Republic over its bloody crackdown on protesters, a move coming as activists said Monday the death toll in the nationwide demonstrations rose to at least 544.

Iran had no immediate reaction to the news, which came after the foreign minister of Oman — long an interlocutor between Washington and Tehran — traveled to Iran this weekend. It also remains unclear just what Iran could promise, particularly as Trump has set strict demands over its nuclear program and its ballistic missile arsenal, which Tehran insists is crucial for its national defense.

Meanwhile Monday, Iran called for pro-government demonstrators to head to the streets in support of the theocracy, a show of force after days of protests directly challenging the rule of 86-year-old Supreme Leader Ayatollah Ali Khamenei. Iranian state television aired chants from the crowd, who shouted “Death to America!” and “Death to Israel!”

Trump and his national security team have been weighing a range of potential responses against Iran including cyberattacks and direct strikes by the U.S. or Israel, according to two people familiar with internal White House discussions who were not authorized to comment publicly and spoke on condition of anonymity.

“The military is looking at it, and we’re looking at some very strong options,” Trump told reporters on Air Force One on Sunday night. Asked about Iran’s threats of retaliation, he said: “If they do that, we will hit them at levels that they’ve never been hit before.”

Trump said that his administration was in talks to set up a meeting with Tehran, but cautioned that he may have to act first as reports of the death toll in Iran mount and the government continues to arrest protesters.

“I think they’re tired of being beat up by the United States,” Trump said. “Iran wants to negotiate.”

He added: “The meeting is being set up, but we may have to act because of what’s happening before the meeting. But a meeting is being set up. Iran called, they want to negotiate.”

Iran through country's parliamentary speaker warned Sunday that the U.S. military and Israel would be “legitimate targets” if America uses force to protect demonstrators.

More than 10,600 people also have been detained over the two weeks of protests, said the U.S.-based Human Rights Activists News Agency, which has been accurate in previous unrest in recent years and gave the death toll. It relies on supporters in Iran crosschecking information. It said 496 of the dead were protesters and 48 were with security forces.

With the internet down in Iran and phone lines cut off, gauging the demonstrations from abroad has grown more difficult. The Associated Press has been unable to independently assess the toll. Iran’s government has not offered overall casualty figures.

Those abroad fear the information blackout is emboldening hard-liners within Iran’s security services to launch a bloody crackdown. Protesters flooded the streets in the country’s capital and its second-largest city on Saturday night into Sunday morning. Online videos purported to show more demonstrations Sunday night into Monday, with a Tehran official acknowledging them in state media.

In Tehran, a witness told the AP that the streets of the capital empty at the sunset call to prayers each night. By the Isha, or nighttime prayer, the streets are deserted.

Part of that stems from the fear of getting caught in the crackdown. Police sent the public a text message that warned: “Given the presence of terrorist groups and armed individuals in some gatherings last night and their plans to cause death, and the firm decision to not tolerate any appeasement and to deal decisively with the rioters, families are strongly advised to take care of their youth and teenagers.”

Another text, which claimed to come from the intelligence arm of the paramilitary Revolutionary Guard, also directly warned people not to take part in demonstrations.

“Dear parents, in view of the enemy’s plan to increase the level of naked violence and the decision to kill people, ... refrain from being on the streets and gathering in places involved in violence, and inform your children about the consequences of cooperating with terrorist mercenaries, which is an example of treason against the country,” the text warned.

The witness spoke to the AP on condition of anonymity due to the ongoing crackdown.

The demonstrations began Dec. 28 over the collapse of the Iranian rial currency, which trades at over 1.4 million to $1, as the country’s economy is squeezed by international sanctions in part levied over its nuclear program. The protests intensified and grew into calls directly challenging Iran’s theocracy.

Nikhinson reported from aboard Air Force One.

In this frame grab from video obtained by the AP outside Iran, a masked demonstrator holds a picture of Iran's Crown Prince Reza Pahlavi during a protest in Tehran, Iran, Friday, January. 9, 2026. (UGC via AP)

In this frame grab from footage circulating on social media from Iran shows protesters taking to the streets despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world in Tehran, Iran, Friday, Jan. 9, 2026.(UGC via AP)

In this frame grab from footage circulating on social media from Iran showed protesters once again taking to the streets of Tehran despite an intensifying crackdown as the Islamic Republic remains cut off from the rest of the world in Tehran, Iran, Saturday Jan. 10, 2026. (UGC via AP)