Current Status Introducing Body:House Bill Number:3018 Primary Sponsor:Kirsh Committee Number:30 Type of Legislation:GB Subject:Kaolin, privilege tax on Residing Body:House Current Committee:Ways and Means Computer Document Number:3018 Introduced Date:Jan 08, 1991 Last History Body:House Last History Date:Jan 08, 1991 Last History Type:Introduced and read first time, referred to Committee Scope of Legislation:Statewide All Sponsors:Kirsh Type of Legislation:General Bill
Bill Body Date Action Description CMN
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3018 House Jan 08, 1991 Introduced and read first 30
time, referred to Committee
3018 House Dec 12, 1990 Prefiled, referred to 30
Committee
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TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 15 TO CHAPTER 21 OF TITLE 12 SO AS TO PROVIDE FOR A PRIVILEGE TAX ON THE EXTRACTION OF KAOLIN, CREATE THE HIGH TECHNOLOGY DEVELOPMENT FUND, AND PROVIDE FOR EXPENDITURES FROM THE FUND.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. The General Assembly finds that the extraction of minerals by mining is a basic and essential activity making an important contribution to the well-being of South Carolina and the nation. South Carolina does not impose a tax for the privilege of severing natural resources in the State, whereas most other states do impose these taxes. Other states use funds collected from privilege taxes to support their educational systems and functions of government, which enhance economic development in those states. Mining companies extract significant amounts of the mineral kaolin from mines in South Carolina for sale worldwide. A privilege tax on the production of kaolin in South Carolina equivalent to five percent of the value of production at the mine will not significantly weaken the economic incentives for investing in South Carolina kaolin mining since the demand for kaolin is strong worldwide and other sources of kaolin supplies are limited. Mining, by its very own nature, does not create economic development because once a natural resource is depleted the mining operations cease. A privilege tax collected and distributed to a High Technology Development Fund will save the benefits of the mining activity for future generations of state citizens. A privilege tax of five percent will not constitute burdensome taxation of kaolin mining because properties for kaolin mines usually are afforded classifications for agricultural production, which enjoy lower assessment ratios than manufacturing property.
SECTION 2. Chapter 21, Title 12 of the 1976 Code is amended by adding:
Section 12-21-2310. This article may be cited as 'The South Carolina Privilege Tax on Kaolin Act'.
Section 12-21-2320. When used or referred to in this article, unless a different meaning clearly appears from the context:
(1) 'Kaolin' means a clay of the hydrous aluminum silicate category consisting of approximately the composition 2H20xA1203x2Si02. Kaolin consists of substantially pure kaolite, or related clay minerals, that is naturally, or can be beneficiated to be white or nearly white, will fire white or nearly white, and is amenable to beneficiation by known methods to make it suitable for use in whiteware, paper, rubber, paint, and similar uses.
(2) 'Value of production' means the total revenues received from the first sale of kaolin for all kaolin produced from mines in this State. When kaolin is transported from the mining site by the mine operator to another site and processed further for sale, the mine operator may establish the value of production based on prevailing market rates for the first sales of unprocessed kaolin.
(3) 'Mine' means an opening or excavation for the extraction of any material for sale.
(4) 'First sale' means the initial transfer of title to the kaolin after the kaolin is mined.
(5) 'Mine operator' means a person, or association of persons, engaged in mining operation, whether individually, jointly, or through subsidiaries, agents, employees, or contractors.
(6) (a) 'Mining' means:
( i) the breaking of the surface soil to facilitate or accomplish the extraction or removal of ores or mineral solids for sale or processing or consumption in the regular operation of a business;
(ii) removal of overburden lying above natural deposits of ore or mineral solids and removal of the mineral deposits exposed, or by removal of ores and mineral solids from deposits lying exposed in their natural state.
(b) Mining does not mean:
( i) removal of overburden and mining of limited amounts of ores or mineral solids when done only for the purpose of determining location, quantity, or quality of a natural deposit, so long as no ores or mineral solids during exploratory excavation or mining are sold, processed for sale, or consumed in the regular operation of a business and provided the land affected does not exceed one acre in area;
(ii) plants engaged in processing minerals except as they are an integral on-site part of the removal of ores or mineral solids from natural deposits;
( iii) excavation or grading when conducted solely in aid of on-site farming or of on-site construction; or
( iv) dredging operations where the operations are engaged in the harvesting of oysters, clams, or the removal of shells from coastal bottoms.
Section 12-21-2330. A privilege tax of five percent is imposed on the value of production of kaolin minerals produced from mining in this State. The proceeds must be distributed into the 'High Technology Development Fund'. The tax is payable to the Tax Commission by the kaolin mine operator quarterly beginning October, 1990. The tax is due fifteen days following the end of the state fiscal quarter.
Section 12-21-2340. A High Technology Development Fund must be established by the State Treasurer. Proceeds from the privilege tax on kaolin are to be distributed to the fund by the Tax Commission. The use of these funds must be established annually by the General Assembly. Proceeds only may be allocated to projects that further the development of higher technology in the State."
SECTION 3. This act takes effect upon approval by the Governor.