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  • South Carolina Daily Gazette

    SC could allow companies to count remote workers in NC, GA as part of tax breaks

    By Jessica Holdman,

    2024-04-02
    https://img.particlenews.com/image.php?url=0dqcSj_0sCpcfUb00

    Sen. Tom Davis, R-Beaufort, reads paperwork while standing at his desk in Senate chambers on the opening day of the 2024 session Tuesday, Jan. 9, 2024, in Columbia, S.C. (Mary Ann Chastain/Special to the SC Daily Gazette)

    COLUMBIA — South Carolina companies could start counting employees working from home in neighboring North Carolina and Georgia toward tax breaks under legislation that makes it easier for businesses to qualify for certain incentives.

    As long as remote workers pay income taxes in the Palmetto State, companies can claim them in their workforce numbers as they ink deals for breaks on their own corporate income taxes.

    That’s among the potential new economic development tools a bill gives South Carolina officials trying to lure new industries, corporate headquarters and recycling companies, such as those harvesting battery metals for the electric vehicle industry.

    A Senate panel added the remote-workers option last week to a tax-credit bill the House passed overwhelmingly last April.

    Sen. Tom Davis said he proposed it as a way to reflect the remote work phenomenon brought on by the COVID-19 pandemic.

    The Beaufort Republican acknowledged that people working from home in a neighboring state might not spend their paychecks in South Carolina stores or restaurants. But they also aren’t costing local governments because they don’t need police or fire protection or send their children to school here, he said.

    The full Senate Finance Committee will take up the amended bill Tuesday.

    ‘Practically never used’

    The legislation also makes it easier for companies to meet requirements for a pair of underutilized programs granting special tax deals to corporate headquarters and recycling facilities that agree to locate in the state.

    “It’s practically never used because no one can qualify for it,” said Burnie Maybank, a lawyer and former state Department of Revenue director who now helps companies negotiate incentive deals.

    For the fiscal year that ended last June, just 26 companies qualified as having headquarters in the state.

    If a company spends $50,000 to construct or expand a regional or national headquarters building in South Carolina, employing at least 40 people in administrative roles typically associated with this type of facility, it can apply 20% of its costs to buy down its state income tax bill.

    Harder to get, particularly in an office setting, has been an extra 20% credit covering what is spent on items like furniture and computers. For that, a company had to have at least 75 new employees.

    This bill does away with the extra jobs requirement in an effort to sweeten the deal and entice more companies to set up their headquarters here.

    When it comes to recycling facilities, the legislation adds batteries and solar panels to the list of recyclable items that qualify for tax credits. It also reduces the required investment threshold for a facility from $300 million down to $150 million.

    In the financial estimates attached to the bill, Commerce Department noted it has had eight projects promising investments of at least $100 million over the last five years. The credit would be worth 30% of a company’s investment — or $45 million for a facility that costs $150 million to build.

    The post SC could allow companies to count remote workers in NC, GA as part of tax breaks appeared first on SC Daily Gazette .

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