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Standardization: New Law, New action

License year, due date, definitions of income

  • Standard due date of April 30, with May 1 start of license year. Penalties imposed after May 1
  • Calculate tax on gross income for calendar year or business' fiscal year
  • Standard definition of gross income
    • Clarifies gross income on which non-resident businesses pay the tax
    • Clarifies that gross income for agents does not include commissions that are divided with separate brokers or agents
    • Manufacturers may calculate tax for municipal locations on lesser of gross income, income allocated/apportioned to a location, expenses of location as cost center

Standard application/refund

  • Standard business license application distributed by Revenue and Fiscal Affairs Office
  • Refunds for overpayment to be requested by taxpayer by June 1

Standard class schedule

  • Jurisdictions must adopt updated class schedule every odd year
  • Class schedule recommended by Municipal Association of SC and certified by Revenue and Fiscal Affairs Office
  • Flexibility to create sub-classes for economic development

Special agreements

  • Protects current and future agreements with businesses on calculation of business license tax

Transition period

  • Sets January 1, 2022, as effective date for law
  • In the first year, prevents jurisdictions from realizing a revenue windfall that might result from transition to the new, mandated class schedule
  • Allows city to gain new revenue in transition year resulting from growth in number of businesses

Online renewal payment portal

  • Online business license renewal payment portal to be hosted and managed by Revenue and Fiscal Affairs Office
  • RFA allowed to contract with software provider for portal services. Software provider may not retain any portion of tax payment
  • Entire taxpayer payment goes directly to jurisdictions
  • Only taxing jurisdictions may use portal information for auditing
  • Jurisdictions must still accept payments in person, by phone or mail

 Appeals process

  • Standard appeals process for all jurisdictions
  • Sets new appeals and response deadlines
  • Appeals of decisions by taxing jurisdiction may be appealed to Administrative Law Court

 Third parties

  • Jurisdictions may continue to contract with third parties to identify non-compliant businesses
  • Restricts third parties' contact with non-compliant businesses