Legislation Proposed to Reform South Carolina’s Onerous Business License Tax System

Staff Report From South Carolina CEO

Wednesday, April 10th, 2019

South Carolina State Representative Jay Jordan filed H. 4431 which will reform South Carolina’s costly, complex, and burdensome business license tax system. 

Cities and counties levy a license tax on businesses for the privilege of doing business in each area. Across the state, over 200 municipalities and 12 counties levy business license taxes. Many of them require different forms, renewal dates, process for appeals, and involve complex and varying methods of calculating the tax in each jurisdiction. A business that files business license taxes in 30 municipalities will spend an average of three weeks a year complying with these requirements. In addition, companies in the Palmetto State are now paying almost 50% more in business license taxes than they were just over a decade ago.

“Businesses in South Carolina, especially small businesses, are struggling to keep up with burdensome compliance and the high costs of the business license tax,” said Ted Pitts, President and CEO of the South Carolina Chamber of Commerce. “We appreciate Rep. Jordan’s effort to bring uniformity and fairness to the system and help South Carolina compete with our neighboring states, like North Carolina which recently repealed the tax.”

“South Carolina is a business-friendly state; however, it’s time to reform our business license process,” said Representative Jay Jordan. “This bill is a step toward simplifying and improving that process. I look forward to working with our business community to make our state even better for job creators.”

Business community weighs in: 

"As a home service provider, we may do business in dozens of South Carolina cities. The administrative and financial burden of filing applications, keeping up with renewals, and complying with each city's unique licensing rules is a huge strain on our small business. This fractured system is setting us up to fail." – Anja Smith, Managing Partner of All Clear Plumbing

“South Carolina’s business license tax system is one of the most costly and burdensome taxes for small businesses.  As a business owner that operates stores across many counties in the state, I can tell you from first-hand experience that South Carolina needs to reform the business license tax system.” –Steve Spinks, President and CEO of The Spinx Company

"South Carolina's business license tax system is not business-friendly. Small businesses are the backbone of the state's economy and if legislators really want to do something to help small business then they need to reform the business license tax system." – Hal Stevenson, Owner of Grace Outdoor Advertising