Sen. Scott, Colleagues introduce State Fiscal Flexibility Act
Washington D.C. (WCIV) — U.S. Senator Tim Scott, along with his Republican colleagues on the Senate Finance Committee, have introduced the State Fiscal Flexibility Act.
The bill will eliminate a provision in the American Rescue Plan that prevents states from using relief funds to cut taxes.
“Democrats slipped in language in their progressive payment plan that not only infringes upon the rights of states, but also penalizes states that have remained financially responsible throughout the pandemic,” said Senator Scott.
“South Carolina knows how our money should be used better than any federal bureaucrat in Washington. “
Scott said that this act will ensure that state leaders are able to make the “best economic decisions for South Carolinians” while not being at the mercy of “liberal politicians.”
The American Rescue Plan includes a $350 billion bailout for states.
Funds can be used for virtually anything a state chooses to spend money on.
However, there are two restrictions: one is that a state may not use recovery funds “for deposit into any pension fund,” and the other is that any state wishing to provide tax relief may do so, but only at a punishable cost.