South Carolina S 439: Manufacturing property tax exemption

Bill Text

2025-2026 Bill 439 Text of Previous Version (Apr. 28, 2026) - South Carolina Legislature Online 

South Carolina General Assembly
126th Session, 2025-2026

Bill 439

Indicates Matter Stricken
Indicates New Matter

(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

Indicates Matter 
Stricken

Indicates New Matter

Committee Report

April 28, 2026

S. 439

Introduced by Senators Peeler, Turner, Davis, 
Bennett, Verdin, Alexander, Grooms, Kimbrell, Johnson, Jackson, Sutton, Cromer, 
Climer, Adams, Zell and Young 

S. Printed 4/28/26--H.

Read the first time May 6, 2025

________

The committee on House Ways and 
Means

To whom was referred a Bill (S. 439) to amend 
the South Carolina Code of Laws by amending Section 12-37-220, relating to 
property tax exemptions, so as to increase the maximum reimbursement amount for, 
etc., respectfully

Report:

That they have duly and carefully considered 
the same, and recommend that the same do pass:

B.W. BANNISTER for Committee.

statement of estimated fiscal impact

Explanation of Fiscal Impact

State Expenditure

This bill increases the reimbursement cap 
for the manufacturing property tax exemption, pursuant to §12-34-220(B)(52), 
from $170,000,000 to $300,000,000. This section exempts 42.8571 percent of the value of manufacturing property from 
property taxes and is reimbursed by the State to local governments from the 
Trust Fund for Tax Relief. 

DOR anticipates being able to administer 
this change within the normal course of agency business. Therefore, this bill 
will have no expenditure impact for implementation.

State Revenue

This bill increases the reimbursement cap 
for the manufacturing property tax exemption, pursuant to §12-34-220(B)(52), 
from $170,000,000 to $300,000,000, which will potentially change the mechanism 
for funding the amount of the reimbursement above $170,000,000.

Based on the current BEA projection, the manufacturing 
property tax exemption reimbursement will exceed the current limit of 
$170,000,0000 by $10,431,611 in FY 2026-27 as shown below. 

Projected Manufacturing Property Tax Exemption 
Reimbursement

 Fiscal Year

 Exemption Amount

 Growth Rate

 FY 2024-25

 $151,878,461

 FY 2025-26(e)

 $164,028,737

 8.0%

 FY 2026-27(e)

 $180,431,611

 10.0%

Pursuant to §11-11-150, the BEA deducted 
$170,000,000 from the state income tax revenue to pay the reimbursements for 
the manufacturing property tax exemption from the Trust Fund for Tax Relief up 
to the current statutory cap. However, Proviso 117.202 of the FY 2025-26 Appropriations 
Act allows up to $300,000,000 to be used for the reimbursements despite the cap 
and specifies that the balance in the Trust Fund for Tax Relief may be used to 
fund the excess amount. Without this bill, the additional $10,431,611 would be 
funded from the Trust Fund balance in FY 2026-27 if Proviso 117.202 remains in 
effect. By increasing the statutory cap from $170,000,000 to $300,000,000, this 
bill will require the BEA to increase the amount deducted from state income tax 
revenues and credited to the Trust Fund for Tax Relief by $10,431,611 in FY 
2026-27. In order to continue to fund the increase in the reimbursements using 
the balance in the Trust Fund, additional legislative direction would be 
necessary. For information, the current projected FY 2025-26 year-end balance 
for the Trust Fund for Tax Relief that would be available to fund the 
$10,431,611 in reimbursements is $114,658,825.

Frank A. Rainwater, Executive Director

Revenue and Fiscal Affairs Office

_______

A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING 
SECTION 12-37-220, RELATING TO PROPERTY TAX EXEMPTIONs, SO AS TO INCREASE THE 
MAXIMUM REIMBURSEMENT AMOUNT for the exemption ON CERTAIN MANUFACTURING 
PROPERTY.

Be it enacted by the 
General Assembly of the State of South Carolina:

SECTION 1. Section 12-37-220(B)(52) of the S.C. Code is amended to 
read:

 (a)(i) 42.8571 percent of the property 
tax value of manufacturing property assessed for property tax purposes pursuant 
to Section 12-43-220(a)(1). The exemption allowed by this item does not apply 
to property owned or leased by a public utility, as defined in Section 58-3-5, 
that is regulated by the Public Service Commission, regardless of whether the 
property is used for manufacturing. For purposes of this item, if the exemption 
is applied to real property, then it must be applied to the property tax value 
as it may be adjusted downward to reflect the limit imposed pursuant to Section 
6, Article X of the South Carolina Constitution, 1895;

 (ii) To the extent any such monies 
are refunded or otherwise credited under this item to a public utility that is 
regulated by the Public Service Commission, regardless of whether the property 
is used for manufacturing, any such refund or credits must be flowed through to 
customers as a reduction in rates, as appropriate.

 (b) 
The revenue loss resulting f