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Subcommittee backs bill to exempt first $10,000 of business personal property tax
Summary
A legislative subcommittee gave House Bill 5006 a favorable report after business groups and small-business owners testified that the state's business personal property tax creates compliance burdens; lawmakers approved a non-$10,000 amendment and discussed possibly raising the exemption later.
A state legislative subcommittee voted to give House Bill 5006 a favorable report after a series of small-business owners and trade groups urged lawmakers to reduce the burden of the state's business personal property (BPP) tax.
Supporters told the panel the proposed law, which would exempt the first $10,000 of BPP from taxation, would simplify compliance and ease a recurring tax burden on small companies. "It's just very frustrating," said Elizabeth Trimbeth, a second-generation owner of Snelling Staffing Services, describing an instance in which she paid tax on a replaced door. "If my son takes over the business in 10 or 20 years, he's gonna be paying taxes on the store as well," she said.
Why it matters: Witnesses said the BPP tax requires detailed annual tracking of depreciable assets and can dissuade small-business investment. Karen Jenkins, president and CEO of KRJ Consulting, described the tax as "essentially a forever tax" that imposes compliance costs and puts South Carolina businesses at a disadvantage compared with neighboring states.
What supporters said: Business advocates and chambers provided testimony in favor of the exemption. Frank Knapp, president and CEO of the South Carolina Small Business Chamber of Commerce, offered brief support. Employers also cited administrative friction: Elliot Wilson, owner of TRC Talent Solutions, called the tax a "logistical nightmare" for companies that must track office furniture and equipment for licensing and tax purposes.
Committee action: A subcommittee member moved for a favorable report, and the panel approved a small amendment to a separate corporate-license provision that the chair described as fixing a drafting error and avoiding a potential constitutional problem. The amendment, which did not change the $10,000 exemption, passed by voice vote. Staff then called the roll; recorded responses included recorded "aye" votes, and the chair announced that HB 5006 received a favorable report.
Next steps: The chair said the subcommittee will bring the bill to a full committee meeting in the near future and may consider amendments, including possible changes to the exemption amount.
Funding and specifics: The bill would exempt the first $10,000 of combined business personal property (not per item). Support letters from Metro Chambers of Commerce were noted by the chair during the hearing.
(Provocation: The subcommittee recorded support during the hearing and approved a drafting amendment; the bill does not yet appear to have final passage.)
