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Indicates Matter Stricken
Indicates New Matter
Indicates Matter Stricken
Indicates New Matter
AMENDED
June 6, 2007
S. 656
Introduced by Senators Leatherman, Moore, Leventis, McGill, Cleary, Setzler, Elliott and Land
S. Printed 6/6/07--H.
Read the first time May 1, 2007.
TO AMEND SECTION 12-36-910, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE IMPOSITION OF THE STATE SALES AND USE TAX AND THE SPECIAL THREE PERCENT SALES AND USE TAX IMPOSED ON UNPREPARED FOOD, SO AS TO REDUCE THIS SPECIAL RATE ON UNPREPARED FOOD FROM THREE PERCENT TO TWO PERCENT EFFECTIVE JANUARY 1, 2008, TO DELETE AN OBSOLETE PROVISION, AND TO REDUCE THIS TWO PERCENT RATE IN INCREMENTS OF ONE-HALF OF ONE PERCENTAGE POINT IF THE FEBRUARY FIFTEENTH FORECAST OF ANNUAL GENERAL FUND GROWTH FOR THE UPCOMING FISCAL YEAR EQUALS AT LEAST FIVE PERCENT OF THE MOST RECENT ESTIMATE OF GENERAL FUND REVENUE FOR THE CURRENT FISCAL YEAR; AND TO AMEND SECTION 12-36-2120, AS AMENDED, RELATING TO SALES TAX EXEMPTIONS, SO AS TO PROVIDE A PERMANENT EXEMPTION FOR UNPREPARED FOOD WHICH LAWFULLY MAY BE PURCHASED WITH UNITED STATES DEPARTMENT OF AGRICULTURE FOOD COUPONS BEGINNING THE JULY FIRST THAT THE PHASE-DOWN OF THE STATE SALES TAX RATE ON UNPREPARED FOOD ATTAINS ZERO.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Article 1, Chapter 11, Title 11 of the 1976 Code is amended by adding:
"Section 11-11-220. (A) There is created in the State Treasury a fund separate and distinct from the general fund of the State, the Capital Reserve Fund, and all other funds entitled the Contingency Reserve Fund. All general fund revenues accumulated in a fiscal year in excess of general appropriations and supplemental appropriations must be credited to this fund. Revenues credited to this fund in a fiscal year may be appropriated by the General Assembly. Upon determination by the Comptroller General as to the amount to be deposited in the Contingency Reserve Fund, the Comptroller General shall notify the Board of Economic Advisors and the board shall recognize that amount as surplus funds.
(B) If the balance in the general reserve fund established pursuant to Article III, Section 36 of the Constitution of this State and Section 11-11-310 is less than the required balance, there must be appropriated to it all amounts in the Contingency Reserve Fund up to the total necessary to replenish the general reserve fund. This amount does not replace or supplant the minimum replenishment amount otherwise required to be made to the general reserve fund."
SECTION 2. Of the first funds available from fiscal year 2006-2007 state general fund surplus revenues, an amount equal to $10,000,000 is appropriated to the State Department of Education to supplement the school districts that are negatively affected by the lack of revision of the 2007 Final Index of Taxpaying Ability. The school districts supplemented by these funds must be separate from the school districts supplemented by the Education Finance Act reserve funds. Funds appropriated pursuant to this section not expended before July 1, 2008, revert to the state general fund.
In fiscal year 2007-2008, school districts that receive a higher amount of state Education Finance Act funds as a result of the lack of revision of the 2007 Final Index of Taxpaying Ability shall direct the excess funds towards nonrecurring allowable expenditures.
The Department of Revenue shall build the 2008 Index of Taxpaying Ability on the 2007 Index of Taxpaying Ability as if it was amended.
SECTION 3. A. Section 12-36-910(D) of the 1976 Code, as added by Act 388 of 2006, is amended to read:
"(D)(1) Notwithstanding the rate of the tax imposed pursuant to subsection (A) of this section or the rate of any other sales tax imposed pursuant to this chapter and the rate of any use tax imposed pursuant to this chapter, the sales and use tax on the gross proceeds of sales or sales price of unprepared food which lawfully may be purchased with United States Department of Agriculture food coupons is three percent and effective November 1, 2007, one percent.
(2) There is transferred from the general fund of the State to the EIA Fund in fiscal year 2006-2007 the revenue estimated by the Board of Economic Advisors to equal EIA revenue not received as a result of the two percent sales tax differential provided pursuant to this subsection. Beginning with the February 15, 2008, forecast by the Board of Economic Advisors of annual general fund revenue growth for the upcoming fiscal year, and annually thereafter, if the forecast of that growth equals at least five percent of the most recent estimate by the board of general fund revenues for the current fiscal year, the then applicable state sales and use tax rate imposed on unprepared food which lawfully may be purchased with United States Department of Agriculture food coupons is reduced, effective the following July first, by one-half of one percentage point. That reduced rate applies until a subsequent reduction takes effect. If the February fifteenth forecast meets the requirement for a rate reduction, the board promptly shall certify this result in writing to the Department of Revenue. On the July first that the rate attains zero, the provisions of this subsection no longer apply.
(3) Twenty percent of the sales and use tax revenue attributable to the then applicable special rate imposed pursuant to this subsection, as estimated by the Board of Economic Advisors, must be credited to the EIA Fund. The balance of the revenue must be credited to the general fund of the State and used for the purposes provided for pursuant to Section 59-21-1010(A)."
B. Section 12-36-2120 of the 1976 Code is amended by adding a new item at the end appropriately numbered to read:
"( ) effective on the July first that the provisions of Section 12-36-910(D) no longer apply, unprepared food that lawfully may be purchased with United States Department of Agriculture food coupons. However, the exemption allowed by this item applies only to the state sales and use tax imposed pursuant to this chapter."
C. Notwithstanding any other provision of law, for fiscal year 2007-2008 only, there must be transferred from the general fund of the State to the EIA Fund an amount estimated by the Board of Economic Advisors to equal the difference between EIA Fund revenues from the sales tax on food in fiscal year 2007-2008 and the amount of such revenue to the EIA Fund in fiscal year 2006-2007.
SECTION 4. Section 12-6-510(A) of the 1976 Code is amended to read:
"(A) For taxable years beginning after 1994 2006, a tax is imposed on the South Carolina taxable income of individuals, estates, and trusts and any other entity except those taxed or exempted from taxation under Sections 12-6-530 through 12-6-550 computed at the following rates with the income brackets indexed in accordance with Section 12-6-520:
Not over $2,220 2.5 percent of taxable income
over $2,220 but $56 plus 3 percent of
not over $4,440 the excess over $2,220;
over $4,440 but $123 plus 4 percent of
not over $6,660 the excess over $4,440;
over $6,660 but $212 plus 5 percent of
not over $8,880 the excess of $6,660;
over $8,880 but $323 plus 6 percent of
not over $11,100 the excess over $8,880;
over $11,100 $456 plus 7 percent of
the excess over $11,100.
OVER BUT NOT
OVER
$0 $2,630 2.5% Times the amount
2,630 5,260 3% Times the amount
less $13
5,260 7,890 4% Times the amount
less $66
7,890 10,520 5% Times the amount
less $144
10,520 13,150 6% Times the amount
less $250
13,150 or more 6.83% Times the amount
less $381."
SECTION 5. There is appropriated from the Contingency Reserve Fund to the South Carolina Research Authority for hydrogen grants the sum of $5,000,000.
SECTION 6. Except where otherwise specified, this act takes effect upon approval by the Governor.
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