05.20.15 |
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Why Open Up Shop in South Carolina? Lucrative Tax Incentives

Employers have plenty of headaches when it comes to running a business.  From payroll management to healthcare regulations and employment taxes, they have a lot on theirSouth Carolina 1plate.  Luckily, business owners in South Carolina have a little reprieve, at least from a tax standpoint.

Forbes lists the Palmetto State as a pro-business state that has a high prospect for growth[1].  The tax climate set by the local government rewards investment and new employment.  According to the South Carolina Power Team, a network of economic development professionals, tax incentives offered by the state include exemptions, abatements, moratoriums, credits and reductions for new and expanding companies.

Aside from no local income tax requirements, the South Carolina Power Team claims that corporate income taxes are lower in South Carolina than anywhere else in the southeast with a flat 5-percent rate[2].  Additionally, there’s no inventory tax, and the state only taxes businesses on revenue generated from in-state operations.[3]

Plus, South Carolina businesses may be eligible to receive tax credits for a certain number of jobs created and maintained in a taxable year[4].  For example, the Jobs Tax Credit is available to companies in manufacturing, distribution, processing, research and development facilities that establish or expand their corporate headquarters in the state[5]. When leaders of these types of businesses create an average of 10 net new full-time jobs per month, their companies may qualify for the Jobs Tax Credit,[6] which can total anywhere from $1,500 to $8,000 per job created[7].

There is also a Corporate Headquarters Tax Credit that can help South Carolina-based companies offset the cost of re-locating to or expanding their facility in the state[8].  For the companies that qualify, a 20-percent tax credit may be available based on the value of a company’s main headquarters or for lease costs paid for the first five years of operation.[9]

Some people believe that South Carolina’s low cost of doing business may correlate to the rise in manufacturing jobs throughout the state.  In 1992, BMW was awarded a $150 million package to open an assembly plant and another $100 million for an expansion in 2003 in South Carolina[10].  Boeing, which was rewarded with subsidies up to approximately $900 million, also operates a manufacturing plant in the rice-producing state[11].

With an economic climate that helps companies keep operating costs down through lucrative tax incentive programs, job creation is poised to continue for South Carolina businesses.

Consider learning more about how ADP® can help businesses identify and capture tax credits and incentives for which they may be eligible.

 
Learn More About ADP SmartCompliance® Tax Credits
 

 

Learn More About ADP SmartCompliance® Tax CreditsThe information provided in this blog post is for informational purposes only and not for the purpose of providing accounting, legal, or tax advice.  The information and services ADP provides should not be deemed a substitute for the advice of any such professional.  Such information is by nature subject to revision and may not be the most current information available.

[1]  http://www.forbes.com/places/sc/

[2] http://www.scpowerteam.com/advantages.aspx

[3] http://www.scpowerteam.com/advantages.aspx

[4] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 5

[5] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 5

[6] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 5

[7] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 6

[8] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 6

[9] http://issuu.com/sccommerce123/docs/2015_business_incentives?e=0/11399461#search, page 6

[10] http://www.goodjobsfirst.org/states/south-carolina

[11] http://www.goodjobsfirst.org/states/south-carolina


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