Indicates Matter Stricken

Indicates New Matter

 

Committee Report

April 28, 2026

 

H. 3371

 

Introduced by Rep. Hixon

 

S. Printed 4/28/26--H.

Read the first time January 14, 2025

 

________

 

The committee on House Ways and Means

To whom was referred a Bill (H. 3371) to amend the South Carolina Code of Laws by amending Section 12-21-2420, relating to admissions tax, so as to exempt admissions charged by certain nonprofit business, etc., respectfully

Report:

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

 

    Amend the bill, as and if amended, SECTION 1, by striking Section 12-21-2420(18) and inserting:

    (18) on admissions charged by business leagues or chambers of commerce qualified under 501(c)(6) by the Internal Revenue Service, which are not organized for profit, and no part of whose earnings inure to the benefit of any private shareholder or individual.

Renumber sections to conform.

Amend title to conform.

 

B.W. BANNISTER for Committee.

 

 

statement of estimated fiscal impact

Explanation of Fiscal Impact

State Expenditure

This bill exempts admissions charged by business leagues or chambers of commerce organized as a 501(c)(6) under the IRC from the admissions tax. Currently, a 5 percent tax is levied on admissions to places of amusement.

This bill will result in a minimal expenditure impact for the DOR to update forms, the department website, and perform system changes for the new exemption. DOR indicates that the changes can be administered with existing staff and appropriations.

State Revenue

This bill exempts admissions charged by business leagues or chambers of commerce organized as a 501(c)(6) under the IRC from the admissions tax. A 5 percent tax is currently levied on admission to places of amusement, subject to some exemptions.

Currently, admissions charged or sponsored by any eleemosynary and nonprofit corporation or organization organized exclusively for religious, charitable, scientific, civic, fraternal, or educational purposes are exempt from the admissions tax, depending upon how the proceeds generated from admissions are distributed and subject to some exclusions. Based on conversations with DOR, 501(c)(6) organizations do not currently qualify for an exemption from admissions tax.

Data regarding the amount of admissions tax generated by type of organization are unavailable. Therefore, in order to estimate the potential impact, Revenue and Fiscal Affairs used the portion of business activity attributable to 501(c)(6) organizations to estimate the percentage of admissions tax attributable to these entities. According to the Internal Revenue Service, there are currently 711 501(c)(6) organizations registered in South Carolina. Overall in the U.S., 501(c)(6) organizations generated approximately $58.46 billion in revenue in tax year 2022. In tax year 2022, U.S. charitable organizations classified as 501(c)(4)-(7) and (9) reported approximately $424 billion in revenue, U.S. corporations reported approximately $39.94 trillion in business receipts, and U.S. partnerships reported approximately $8.34 trillion in business receipts.   Based on these figures, the share of revenue generating activities by 501(c)(6) organizations in the U.S. is approximately 0.12 percent. For this analysis, we have assumed that the percentage of admissions tax generated by the 501(c)(6) charities is relatively the same as the share of overall revenue.

Section 12-62-60 states that 26 percent of the General Fund portion of admissions collections for the previous fiscal year must be allocated to the South Carolina Film Commission of the SC Department of Parks, Recreation and Tourism. The table below provides the estimated General Fund admissions tax based on the November 18, 2025, forecast by the S.C. Board of Economic Advisors (BEA). Based on these figures, the estimated amounts to be transferred to the SC Fillm Commission and total admissions tax revenue are also shown below. Multiplying the expected total admissions tax revenue by 0.12 percent for FY 2026-27, FY 2027-28, and FY 2028-29 yields approximately $65,000, $67,000, and $69,000, respectively that would be exempted under the bill.

 

Estimated Admissions Tax Revenue and Exemption

Fiscal Year	General Fund Admissions Tax	SC Fillm Commission Transfer	Total Admissions Tax	Estimated 501(c)(6) Exemption*
FY 2024-25	$39,965,358
FY 2025-26 (est.)	$40,393,000	$10,390,993	$50,783,993
FY 2026-27 (est.)	$43,304,000	$10,502,180	$53,806,180	$65,000
FY 2027-28 (est.)	$44,192,000	$11,259,040	$55,451,040	$67,000
FY 2028-29 (est.)	$45,656,000	$11,489,920	$57,145,920	$69,000

*Figures are rounded.

 

The bill is effective upon approval by the Governor, and this analysis assumes it will affect collections beginning in FY 2026-27. Because the transfer to the Film Commission is based on the prior year's General Fund collections, the impact on the transfer amount does not occur until FY 2027-28. The table below shows the impact for the next three fiscal years. For the purposes of this analysis, we have assumed that the admissions revenues from 501(c)(6) organizations that will be exempted under the bill are not associated with a major tourism or recreation facility subject to the transfers in Sections 12-21-6530 and 6540. If admissions from these organizations are currently subject to these transfers, the distribution of the impact would be affected.

 

Estimated Impact of Exempting 501(c)(6) Organizations from Admissions Tax

Fiscal Year	General Fund Admissions Tax Reduction	SC Film Commission Revenue Reduction	Total Impact
FY 2026-27	($65,000)		($65,000)
FY 2027-28	($50,000)	($17,000)	($67,000)
FY 2028-29	($56,000)	($13,000)	($69,000)

 

 

Frank A. Rainwater, Executive Director

Revenue and Fiscal Affairs Office

 

_______

 

 

 

 

 

 

 

 

A bill

 

to amend the South Carolina Code of Laws by amending Section 12-21-2420, relating to admissions tax, so as to EXEMPT ADMISSIONS CHARGED BY CERTAIN NONPROFIT BUSINESS LEAGUES AND CHAMBERS OF COMMERCE.

 

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

 

SECTION 1.  Section 12-21-2420 of the S.C. Code is amended by adding:

 

    (18) on admissions charged by business leagues or chambers of commerce qualified under 501(c)(6) by the Internal Revenue Service, which are not organized for profit, and no part of whose earnings inure to the benefit of any private shareholder or individual.

 

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

----XX----