H 3332 General Bill, By Witherspoon, Altman, Askins, Barfield, Barrett, Battle, 
H. Brown, T. Brown, Cooper, Davenport, Edge, J.G. Felder, Harrell, Hawkins, 
Keegan, Kelley, M.H. Kinon, Knotts, Lee, Limehouse, Loftis, Mason, McCraw, 
Miller, Phillips, Rhoad, Riser, Sandifer, Seithel, Sharpe, Stille, 
E.C. Stoddard, Tripp, Trotter, Walker and Whatley
 A BILL TO AMEND TO THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION
 12-37-224 SO AS TO PROVIDE THAT A BOAT ON WHICH THE INTEREST PORTION OF ANY
 INDEBTEDNESS THEREON IS OR WOULD BE DEDUCTIBLE UNDER THE INTERNAL REVENUE CODE
 AS AN INTEREST EXPENSE ON A QUALIFIED PRIMARY OR SECOND RESIDENCE IS ALSO
 DEEMED TO BE A PRIMARY OR SECOND RESIDENCE FOR PURPOSES OF AD VALOREM PROPERTY
 TAXATION IN THIS STATE AND AS SUCH IS CONSIDERED REAL RATHER THAN PERSONAL
 PROPERTY FOR THESE PURPOSES, AND TO PROVIDE A CAP ON THE MAXIMUM AD VALOREM
 TAXATION WHICH MAY BE LEVIED ON SUCH A BOAT FOR ANY YEAR.

   01/29/97  House  Introduced and read first time HJ-10
   01/29/97  House  Referred to Committee on Ways and Means HJ-11
   04/17/97  House  Committee report: Favorable Ways and Means HJ-4
   04/29/97  House  Requests for debate-Rep(s). Simrill, Young,
                     Kirsh, Whipper & Mack HJ-16
   04/29/97  House  Requests for debate removed-Rep(s). Whipper &
                     Mack HJ-90
   04/29/97  House  Objection by Rep. Moody-Lawrence & Neal HJ-109
   04/30/97  House  Read second time HJ-86
   04/30/97  House  Roll call Yeas-73  Nays-29 HJ-86
   05/01/97  House  Read third time and sent to Senate HJ-35
   05/01/97  Senate Introduced and read first time SJ-18
   05/01/97  Senate Referred to Committee on Finance SJ-18

April 17, 1997

H. 3332

Introduced by Reps. Witherspoon, H. Brown, Sandifer, Barfield, Barrett, Lee, Walker, Askins, Seithel, Battle, Whatley, Edge, Tripp, Keegan, Stille, Loftis, Kelley, Trotter, Cooper, Rhoad, Miller, Riser, Knotts, Mason, Limehouse, T. Brown, Harrell, Altman, Felder, Davenport, Phillips, McCraw, Kinon, Stoddard, Hawkins and Sharpe

S. Printed 4/17/97--H.

Read the first time January 29, 1997.

To whom was referred a Bill (H. 3332), to amend the Code of Laws of South Carolina, 1976, by adding Section 12-37-224 so as to provide that a boat, etc., respectfully

That they have duly and carefully considered the same, and recommend that the same do pass:

HENRY E. BROWN, JR., for Committee.

This bill would shift approximately $1,100,000 in local property tax revenue to other classes of taxpayers. This shift would be reduced in future years as more boat owners register their property in the state.

This legislation would reduce the assessment ratio for boats that qualify for an interest deduction under the Internal Revenue Code. From date provided by the Department of Natural Resources, we estimate that approximately 6,100 boats would qualify for the tax reduction. We further assume that the fair market value of these boats average $15,000 and the average statewide millage rate is 225 mills. The revenue loss would therefore total approximately $1,000,000. Finally we assume that the maximum tax of $1,500 per boat would increase the revenue loss by 10 percent.

Approved By:

Burnet R. Maybank, III

S.C. Department of Revenue

TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING SECTION 12-37-224 SO AS TO PROVIDE THAT A BOAT ON WHICH THE INTEREST PORTION OF ANY INDEBTEDNESS THEREON IS OR WOULD BE DEDUCTIBLE UNDER THE INTERNAL REVENUE CODE AS AN INTEREST EXPENSE ON A QUALIFIED PRIMARY OR SECOND RESIDENCE IS ALSO DEEMED TO BE A PRIMARY OR SECOND RESIDENCE FOR PURPOSES OF AD VALOREM PROPERTY TAXATION IN THIS STATE AND AS SUCH IS CONSIDERED REAL RATHER THAN PERSONAL PROPERTY FOR THESE PURPOSES, AND TO PROVIDE A CAP ON THE MAXIMUM AD VALOREM TAXATION WHICH MAY BE LEVIED ON SUCH A BOAT FOR ANY YEAR.

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

SECTION 1. The 1976 Code is amended by adding:

"Section 12-37-224. A boat on which the interest portion of any indebtedness thereon is or would be deductible under the Internal Revenue Code as an interest expense on a qualified primary or second residence is also deemed to be a primary or second residence for purposes of ad valorem property taxation in this State and as such is considered real rather than personal property for these purposes. Additionally, the maximum ad valorem taxation on such a boat for any year is one thousand five hundred dollars."

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