South Carolina S 390: Income tax credits

Bill Text

South Carolina General Assembly

123rd Session, 2019-2020



S. 390



STATUS INFORMATION



General Bill

Sponsors: Senator Rice

Document Path: l:\council\bills\nl\13793sd19.docx



Introduced in the Senate on January 22, 2019

Currently residing in the Senate Committee on Finance



Summary: Income tax credits





HISTORY OF LEGISLATIVE ACTIONS



	Date	Body	Action Description with journal page number	

	1/22/2019	Senate	Introduced and read first time (Senate Journal‑page 4)

	1/22/2019	Senate	Referred to Committee on Finance (Senate Journal‑page 4)



View the latest legislative information at the website





VERSIONS OF THIS BILL



1/22/2019





















A BILL



TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12‑6‑3800 SO AS TO PROVIDE FOR TAX CREDITS OR REBATES AGAINST VARIOUS TYPES OF TAXES IMPOSED UNDER STATE LAW FOR ELIGIBLE TAXPAYERS EQUAL TO TWENTY PERCENT OF NEW TAX REVENUE PAID BY THESE TAXPAYERS IF THEY HAVE MADE A QUALIFYING CAPITAL INVESTMENT AT THEIR BUSINESS LOCATION WHERE THIS ADDITIONAL TAX REVENUE WAS GENERATED, AND TO PROVIDE PROCEDURES FOR AND LIMITATIONS ON THESE TAX CREDITS OR REBATES.



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



SECTION	1.	Chapter 6, Title 12 of the 1976 Code is amended by adding:



	“Section 12‑6‑3800.	(A)	As used in this section, the following words and phrases, unless the contract clearly indicates otherwise, mean:

		(1)	‘Qualifying capital investment’ means an expenditure in an aggregate amount of two hundred fifty thousand dollars or more to acquire, lease, or improve real and business personal property that is used in operating a business location which holds a State of South Carolina retail sales tax license.  Qualifying capital investment, however, does not include relocating an existing business in this State to another location in this State without the required additional capital investment.

		(2)	‘Taxpayer’ means a sole proprietor, partnership, corporation of any classification, limited liability company, or association taxable as a business entity that is subject to South Carolina taxes as contained in Section 12‑6‑510 or 12‑6‑530, and Chapter 36, Title 12.

	(B)	The taxes to which the tax credits or rebates provided by this section apply are:

		(1)	state sales and use taxes imposed by the provisions of Chapter 36.  The tax credits provided by this item also apply to local option sales and use taxes authorized by law which are collected by the Department of Revenue and remitted to the local jurisdictions authorized to receive the proceeds.  The department in these cases shall deduct from the revenue distributed to the local jurisdiction the amount of the tax credit to which the taxpayer is entitled;

		(2)	ad valorem property taxes which do not include any payments required under a fee in lieu of a property tax agreement; and

		(3)	 state income taxes imposed under Chapter 6.

	(C)	A taxpayer in a tax year beginning in 2019, and after that may claim annually a nonrefundable tax credit or rebate against each of the taxes enumerated in subsection (B) in an amount equal to twenty percent of the additional tax revenue paid by the taxpayer in regard to those taxes as determined by the Department of Revenue if the taxpayer has made a qualifying capital investment in the business location where the additional tax revenue was generated, which location must be engaged primarily in the sale of tangible personal property at retail and for which the taxpayer holds a state retail sales tax license.

	(D)	For purposes of determining the amount of sales or income taxes paid at a particular location where the qualifying capital investment pertains to the expansion of an existing business location, the ratio of the square footage of the expansion as compared to the overall square footage of the location, multiplied by the total sales or income taxes paid, is considered to be the amount of new sales or income tax revenue generated.

	(E)	The department may require information and submissions by the taxpayer as it considers appropriate in relation to a taxpayer’s claim of entitlement to the credit.  The department in implementing the tax credits or rebates authorized by this section may permit the taxpayer to claim the credit or rebate on the sales tax or income tax return or property tax payment filed by the taxpayer.

	(F)	The merger, consolidation, or reorganization of a corporation where tax credits or rebates provided by this section survive does not create new eligibility in a succeeding corporation, but unused credits or rebates may be transferred and continued by the succeeding corporation.  In addition, a corporation or partnership may assign its rights to its unused credit or rebate to another corporation or partnership if it transfers all, or substantially all, of the assets of the corporation or partnership or all, or substantially all, of the assets of the trade or business or operating di