Senate committee advances cybersecurity bill that includes tax deductions

  • Posted: Wednesday, March 20, 2013 12:01 a.m., Updated: Wednesday, March 20, 2013 8:42 a.m.

— A panel of state senators advanced a wide-ranging cybersecurity bill Tuesday that would extend state-funded credit monitoring for S.C. taxpayers for 10 years.

Credit monitoring

The ProtectMyID service from Experian, paid for by the state at a cost of $12 million, is being offered to anyone who has filed a South Carolina tax return since 1998.

To sign up for ProtectMyID by March 31:

Individuals should visit protect myid.com/scdor and use the activation code SCDOR123, or call toll-free 866-578-5422.

Business owners can sign up for free credit-monitoring services through either Dun & Bradstreet Credibility Corp. at dandb.com/sc or Experian’s Business Credit AdvantageSM at smartbusiness reports.com/SouthCarolina.

The proposal follows last year’s massive breach of the state’s tax collection agency, the S.C. Department of Revenue.

The state currently is offering a year of credit monitoring to taxpayers following the cyberattack. The bill, which next heads to the Senate floor, would allow taxpayers to choose to purchase their own identity-theft protection and to claim income tax deductions for buying it.

The proposal also would create an identity theft unit within the S.C. Department of Consumer Affairs, put a cybersecurity chief over a new technology division, and create new committees to make recommendations on cybersecurity upgrades.

The measure, which was developed by a special Senate committee created following last year’s hacking, received unanimous approval from the Senate Finance Committee.

But a powerful member of the budget writing panel cautioned that the legislation creates many new layers of bureaucracy.

“I haven’t seen this much creation since Genesis,” said Senate Majority Leader Harvey Peeler of Gaffney.

Sen. Kevin Bryant, an Anderson Republican who co-chaired the hacking committee, argued the bill could help make government more efficient by providing a security template for agencies. And he said senators on the hacking committee who worked on the bill, amending it nearly a dozen times already, are open to other suggestions.

“We’re not really wedded to anything in this bill,” he said.

The Revenue Department breach compromised tax information, including Social Security numbers, for 3.8 million taxpayers, 1.9 million dependents and 700,000 businesses.

The state has required taxpayers and businesses to sign up for state-purchased monitoring because officials have said they could not legally auto-enroll those affected.

The Senate bill advanced Tuesday could allow for streamlined enrollment, such as through checking a box on a tax return, according to Senate Finance Committee staff.

There has not yet been an estimate by state economists for how much the bill’s proposals would cost the state.

Senate Finance Committee Chairman Hugh Leatherman, R-Florence, had his own prediction: “I suspect the state will pay tens of millions, hundreds of millions, before this thing is over.”

Sen Joel Lourie, D-Columbia, asked senators to consider creating a fund for hacking victims. But Leatherman said that suggestion would be tough to implement. “I don’t know how we set up a fund,” he said. “Nobody knows what size it would have to be.”



Reach Stephen Largen at 864-641-8172 and follow him on Twitter @stephenlargen.

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