The General Assembly session ended with a huge flourish. Business License Tax reform passed the General Assembly after more than ten years.
- This legislation streamlines and standardizes the business license tax process without negatively impacting municipal revenue (which has been a major sticking point for years)
- There will be an online payment portal,
- Common applications,
- Appeals processes.
- A common time frame for all applications (May 1 – Apr. 30)
- Third-party collections were allowed but some protections
- Tthird-party entity is prohibited from assessing business license taxes or requiring a business entity to remit confidential business license tax data to that private third party
- If a business requests in writing that the third party cease communication with the business, then the third party is strictly prohibited from any further contact.
- Anti-harassment language
- Prohibited from sharing any data from the business
- The right to sue the third party collection group as a private right of action.
Full language of the bill can be found at https://www.scstatehouse.gov/sess123_2019-2020/prever/4431_20200923.htm
Cares Act Phase II adopted
- $420 million for the Unemployment Insurance (UI) Trust Fund.
- This is in addition to the $500 million allocated for the trust fund in Phase I (so $920 million total has been sent to the trust fund)
- set the total effective UI tax rates for 2021 rate classes at the same total effective rates as 2020 rate classes
- meaning that regardless of the trust fund balance, for 2021, businesses will not have to pay tax rates above what they are paying this year
- DHEC Testing and Monitoring: $73M
- MUSC Testing: $20.2M
- Nonprofit Relief Program: $25M
- Minority and Small Business Relief Program: $40M
- Priority must be given to minority businesses, to applicants that did not receive other assistance, such as a Paycheck Protection Program loan or other CARES funds, to businesses with fifteen or fewer employees, and to businesses that demonstrate the greatest financial need
- The South Carolina Department of Administration (Admin) and its grants manager partner, Guidehouse, are working with a panel of state agencies specified in the legislation to develop a minority and small business enterprise reimbursement grant program. More specifically, this grant program awards grants to reimburse qualifying minority and small business enterprises for some, or all, of the costs associated with qualifying expenditures incurred, or expected to be incurred, by the qualifying minority or small business enterprise between March 1, 2020, and December 1, 2020. A qualifying minority or small business enterprise may receive a grant in an amount between $2,500-$25,000. Minority and small business enterprises must apply for grants no later than November 1, 2020. The respective panels began to meet last week and additional information will be provided by October 12. It is expected that applications will begin to be accepted October 19. Additional information about the CARES Act can be found on the accelerateSC website: https://accelerate.sc.gov/cares-act.
- State, Local Government, Independent College and University Expenditures: $115M
- Forgiven Paycheck Protection Program (PPP) loans are excluded from gross income for state tax purposes.
Full language of the bill can be found here. https://www.scstatehouse.gov/sess123_2019-2020/prever/3210_20200923.htm
PPP forgiveness
- The General Assembly passed language to forgive PPP loans from taxes at the state level that are forgiven at the federal level.
PT-100 uniformity
- The General Assembly adopted language to make the PT-100 uniform across all counties. Currently a county can use any form it chooses. They will now be required to use the same form as the Department of Revenue making the process easier for business.
We have also been extremely active with issues ranging from tort reform to minimum wage to getting more folks in the workforce and working with the technical colleges to get skilled workers and expansion of broadband in the state. In what was a very interesting session full of change and uncertainty it ended strong for small business.
