What Is the 'Yankee Tax'? South Carolina Lawmakers Consider Newcomer Fees

What is the 'Yankee Tax' bill South Carolina lawmakers have proposed? What does it mean for people planning to move to the Palmetto State?


Feb. 27 2023, Published 10:40 p.m. ET

South Carolina beach
Source: Getty Images

South Carolina lawmakers are pushing for a 'Yankee Tax.'

During the COVID-19 pandemic, many people uprooted their lives and headed south, but the sudden influx of Northeasterners to less populous southern states has put a strain on their infrastructure.

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That’s why South Carolina lawmakers have proposed a bill called the ‘Yankee Tax’ for newcomers who’ve recently moved or are planning to move to the Palmetto State.

So, what is the 'Yankee Tax'? And will it apply to you if you move to South Carolina? Let’s find out.

What is the 'Yankee Tax'?

'Yankee Tax' refers to a bill that South Carolina Senator Stephen Goldfinch proposed that would require new residents who move to the state to pay up to $500. People flocked to the Southeast during the COVID-19 pandemic and stayed due to work flexibility, lower taxes, and warmer weather.

If the bill gets passed, new residents would pay two one-time fees to legally drive on the state’s roads. The first one is $250 for a new driver’s license and an additional $250 to register their vehicle.

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The funds raised from the bill would support South Carolina's infrastructure like bridges, roads, and railways.

Who pays the 'Yankee Tax'?

South Carolina wants to cash in on their newest wave of residents by charging them a one-time fee to get their driver's license and register their vehicles. This is in addition to the regular fees for license and registration.

Rather than pay these fees directly to the department, South Carolina's newest residents would pay the fees through their property tax and then take the receipt to their local DMV as proof of payment.

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While it's called the 'Yankee Tax,' the bill would mainly impact southerners. South Carolina's population boom has really been driven by migration from the surrounding states.

Who benefits from the 'Yankee Tax'?

All residents would benefit from the 'Yankee Tax.' Senator Goldfinch claims the newly proposed charges would ensure newcomers help pay to use the infrastructure that existing residents have already funded.

"Our quality of life has been diminished by the almost 4 million people that have moved here in the last decade." Goldfinch said. "And we anticipate another million people moving here in the next decade. Everybody is concerned about their quality of life."

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The fees would be like charges construction companies pay when they start a new project, aimed to offset the impact their activities would have on the local infrastructure and utilities.

What's next for the 'Yankee Tax'?

Lawmakers will be meeting next week to debate on the future of the 'Yankee Tax.' If it gets passed, counties will get to vote on it in the 2024 elections.

California and New York recently proposed legislation to tax people leaving their states.

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