Current Status Bill Number:4951 Type of Legislation:General Bill GB Introducing Body:House Introduced Date:19980402 Primary Sponsor:Vaughn All Sponsors:Vaughn and Allison Drafted Document Number:jic\5464htc.98 Residing Body:House Current Committee:Ways and Means Committee 30 HWM Subject:Divided Municipality Sales Tax Act, Taxation, Political Subdivisions, Municipal Corporations, Sales and use
Body Date Action Description Com Leg Involved
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House 19980402 Introduced, read first time, 30 HWM
referred to Committee
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TO AMEND THE CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 5 IN CHAPTER 10 OF TITLE 4, RELATING TO LOCAL SALES AND USE TAXES, ENACTING THE DIVIDED MUNICIPALITY SALES TAX ACT, SO AS TO AUTHORIZE THE IMPOSITION BY REFERENDUM APPROVAL OF A ONE PERCENT SALES AND USE TAX IN A MUNICIPALITY LOCATED IN MORE THAN ONE COUNTY, TO PROVIDE FOR THESE CIRCUMSTANCES RESULTING IN RESCINDING THE TAX, AND TO REQUIRE THE TAX REVENUE TO BE USED TO REDUCE MUNICIPAL PROPERTY TAXES AND FOR MUNICIPAL GOVERNMENT PURPOSES.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 10, Title 4 of the 1976 Code is amended by adding:
Section 4-10-510. This article may be cited as the 'Divided Municipality Sales Tax Act'.
Section 4-10-520. As used in this article, a municipality is a municipal corporation created pursuant to Chapter 1 of Title 5, the corporate limits of which include territory in more than one county.
Section 4-10-530. Subject to the requirements of this article, the municipal council may impose a one percent sales and use tax by ordinance, subject to referendum approval. The tax may be imposed in that portion of the municipality not subject to the tax imposed pursuant to Article 1 of this chapter.
Section 4-10-540. (A) The sales and use tax authorized by this article is imposed by an enacting ordinance of the municipal council.
(B) Upon receipt of the ordinance, the municipal election commission shall conduct a referendum on the question of imposing the municipal sales and use tax. A referendum for this purpose must be held at the time of the general election. Two weeks before the referendum the election commission shall publish in a newspaper of general circulation the question that is to appear on the ballot. This notice is in lieu of any other notice otherwise required by law.
(C) The referendum question to be on the ballot must read substantially as follows:
'Must a one percent sales and use tax be imposed in (municipality) for municipal property tax relief and to provide additional revenues for municipal purposes?
Yes []
No []'
(D) All qualified electors desiring to vote in favor of imposing the tax shall vote 'Yes' and all qualified electors opposed to imposing the tax shall vote 'No'. If a majority of the votes cast are in favor of imposing the tax, then the tax is imposed as provided in this article. The election commission shall conduct the referendum under the election laws of this State, mutatis mutandis, and shall certify the result no later than December thirty-first to the municipal governing body and to the Department of Revenue.
(E) Upon receipt of the returns of the referendum, the municipal council, by resolution, shall declare the results thereof. The results of the referendum may not be questioned except by a suit or proceeding instituted within thirty days from the date the resolution is adopted.
Section 4-10-550. If the sales and use tax is approved in the referendum, the tax is imposed on the first of April following the date of the referendum. If the certification is not timely made to the Department of Revenue, the imposition is postponed for twelve months.
Section 4-10-560. (A) Upon petition of at least fifteen percent of the qualified electors of a municipality presented to the municipal council of the municipality which has implemented the one percent sales and use tax authorized by this article requesting that this tax be rescinded, the council shall direct the municipal election commission to conduct a referendum on the question of rescinding the municipal sales and use tax. A referendum for this purpose must be held on the Tuesday following the first Monday in November following verification of the petition. Two weeks before the referendum the election commission shall publish in a newspaper of general circulation the question that is to appear on the ballot. This notice is in lieu of any other notice otherwise required by law.
(B) The referendum question to be on the ballot must read substantially as follows:
'Must the one percent municipal sales and use tax imposed in be rescinded?
Yes []
(C)(1) All qualified electors desiring to vote in favor of rescinding the tax shall vote 'Yes' and all qualified electors opposed to rescinding the tax shall vote 'No'. If a majority of the votes cast are in favor of rescinding the tax, then the tax is rescinded effective April first following the referendum. The election commission shall conduct the referendum under the election laws of this State, mutatis mutandis, and shall certify the result no later than December thirty-first to the municipal council. If a majority 'Yes' vote is certified, it must be certified to the Department of Revenue by the same date.
(2) Upon receipt of the return of the referendum, the municipal council shall declare the results thereof by resolution. The results of the referendum may not be questioned except by a suit or proceeding instituted within thirty days from the date the resolution is adopted.
(D) A referendum for rescission of this tax may not be held earlier than two years after the tax has been imposed in the municipality. If a majority of the qualified electors voting in the rescission referendum vote against rescinding the tax, no further rescission referendums may be held for a period of two years. If a majority of the qualified electors vote in favor of rescinding the tax, the tax may not be reimposed in the municipality for a period of two years. The petition requesting rescission must be presented to the municipal governing body at least one hundred twenty days before the Tuesday following the first Monday of November of that year or the referendum must be held on the Tuesday following the first Monday of November of the following year.
(E) The municipal council may rescind the tax by ordinance effective with the first day of the third month following the month in which the rescission ordinance is enacted.
(F) When the tax allowed pursuant to Article 1 of this chapter is imposed in a part of a municipality imposing the tax allowed by this article, the tax imposed by this article is rescinded in the portion of the municipality located in the county in which the tax allowed pursuant to Article 1 of this chapter is imposed effective on the imposition date of the other tax. Notwithstanding the allocation of local sales and use tax revenues provided in Article 1, Chapter 4 of this title, or any county ordinance applicable to such allocation, credit against municipal taxes in the portion of the municipality subject to the county sales and use tax must not exceed the credit allowed pursuant to the municipal ordinance implementing this article and revenue allocated to the municipality under the county sales and use tax must not be less than amounts distributed to the municipality pursuant to the municipal ordinance implementing this article.
Section 4-10-570. (A) The tax levied pursuant to this article must be administered and collected by the Department of Revenue in the same manner that other sales and use taxes are collected. The department may prescribe amounts that may be added to the sales price because of the tax.
(B) The tax authorized by this article is in addition to all other local sales and use taxes and applies to the gross proceeds of sales in the applicable area that is subject to the tax imposed by Chapter 36 of Title 12 and the enforcement provisions of Chapter 54 of Title 12. The gross proceeds of the sale of items subject to a maximum tax in Chapter 36 of Title 12 are exempt from the tax imposed by this article. The tax imposed by this article also applies to tangible personal property subject to the use tax in Article 13, Chapter 36 of Title 12.
(C) Taxpayers required to remit taxes under Article 13, Chapter 36 of Title 12 shall identify the municipality in which the personal property purchased at retail is stored, used, or consumed in this State.
(D) Utilities shall report sales in the municipality in which the consumption of the tangible personal property occurs.
(E) A taxpayer subject to the tax imposed by Section 12-36-920, who owns or manages rental units in more than one municipality shall report separately in his sales tax return the total gross proceeds from business done in each municipality.
(F) The gross proceeds of sales of tangible personal property delivered after the imposition date of the tax levied under this article in a municipality, either under the terms of a construction contract executed before the imposition date, or a written bid submitted before the imposition date, culminating in a construction contract entered into before or after the imposition date, are exempt from the sales and use tax provided in this article if a verified copy of the contract is filed with the Department of Revenue within six months after the imposition date of the sales and use tax provided for in this article.
(G) Notwithstanding the imposition date of the sales and use tax authorized pursuant to this chapter, with respect to services that are billed regularly on a monthly basis, the sales and use tax authorized pursuant to this article is imposed beginning on the first day of the billing period beginning on or after the imposition date.
Section 4-10-580. (A) The revenues of the tax collected under this article must be remitted to the Department of Revenue and placed on deposit with the State Treasurer and credited to a fund separate and distinct from the general fund of the State. After deducting the amount of any refunds made and costs to the Department of Revenue of administering the tax, not to exceed one percent of the revenues, the State Treasurer shall distribute the revenues quarterly to the municipality in which the tax is imposed. The State Treasurer may correct misallocations by adjusting subsequent distributions, but these adjustments must be made in the same fiscal year as the misallocations.
(B) At least seventy-one percent of the revenue of this tax must be used to reduce municipal tax millage in the manner that the municipal council determines. The balance may be used for municipal purposes as the council determines. If the percentage required for tax reduction is more than sufficient to eliminate municipal tax millage, excess amounts must be used for municipal purposes. The reduction required by this section applies only to property located in the portion of the municipality in which the tax allowed by this article is imposed.
Section 4-10-590. The Department of Revenue shall furnish data to the State Treasurer and to the municipalities receiving revenues for the purpose of calculating distributions and estimating revenues. The information that must be supplied to municipalities upon request includes, but is not limited to, gross receipts, net taxable sales, and tax liability by taxpayers. Information about a specific taxpayer is considered confidential and is governed by the provisions of Section 12-54-240. A person violating this section is subject to the penalties provided in Section 12-54-240."
SECTION 2. This act takes effect upon approval by the Governor.