H 3588 General Bill, By Kirsh
 A Bill to amend Section 12-37-450, Code of Laws of South Carolina, 1976,
 relating to the reimbursement paid counties and municipalities for the
 business inventory tax exemption, so as to provide for the proportionate
 redistribution to other 1987 tax year millages when debt service of a
 political subdivision within the county is paid off and to delete obsolete
 provisions.

   03/02/93  House  Introduced and read first time HJ-9
   03/02/93  House  Referred to Committee on Ways and Means HJ-9

A BILL

TO AMEND SECTION 12-37-450, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE REIMBURSEMENT PAID COUNTIES AND MUNICIPALITIES FOR THE BUSINESS INVENTORY TAX EXEMPTION, SO AS TO PROVIDE FOR THE PROPORTIONATE REDISTRIBUTION TO OTHER 1987 TAX YEAR MILLAGES WHEN DEBT SERVICE OF A POLITICAL SUBDIVISION WITHIN THE COUNTY IS PAID OFF AND TO DELETE OBSOLETE PROVISIONS.

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

SECTION 1. Section 12-37-450 of the 1976 Code is amended to read:

"Section 12-37-450. (A) The inventory of business establishments shall be exempt from property taxation as follows: for the 1985 tax year, seventeen percent; for the 1986 tax years, fifty percent; for the 1987 and subsequent tax years, one hundred percent. The exemption herein provided is conditional upon the appropriation by the State to the municipalities and counties for each year an amount equal to tax revenue not collected by reason of the exemption. If the appropriation for any year is less than the amount equal to the tax revenue not collected, the exemption shall be proportionately reduced in the manner provided in (C) below. The exemption provided in this section is not allowed if the return is received by the Commission after the date due or the tax due is received by the county or municipality after the date due.

(B) Counties and municipalities must be reimbursed for the revenue lost as a result of the business inventory tax exemption based on the 1987 tax year millage and 1987 tax year assessed value of inventories in the counties and municipalities. If an amount of reimbursement to a political subdivision within a county is attributable to debt service for any purpose, when the debt is paid the appropriate reimbursement amount must be redistributed proportionately to the other separate millages levied by such political subdivision for the 1987 tax year.

(C) The South Carolina Tax Commission shall annually notify each county auditor of the fair market value of merchant's inventory in the manner provided by S 12-37-1420, which must be assessed at a six percent ratio and entered on the tax duplicate. For the purpose of implementing the business inventory tax exemption provided in this section, the assessed value will then be credited by seventeen percent for taxable year 1985, by fifty percent for taxable year 1986, and by one hundred percent for taxable year 1987 and after 1987. If, for taxable years 1986 and 1987 the State does not reimburse the counties and municipalities for the full amount of the revenue lost because of the applicable exemption, the counties and municipalities shall credit the percentage reimbursed to the merchant's account and bill the remainder to the merchant.

(D) Notwithstanding any other provision of law, business inventory exempted from property taxation in the manner provided in this section is considered taxable property in an amount equal to the 1987 tax year assessed valuation for purposes of bonded indebtedness pursuant to Sections 14 and 15 of Article X of the Constitution of this State and for purposes of computing the `index of taxpaying ability' pursuant to item (3) of Section 59-20-20."

SECTION 2. This act takes effect upon approval by the Governor.