Sales Tax Exemption: Inventories, intangible personal property, R&D equipment, manufacturing equipment, and industrial electricity are exempt from sales tax.  Construction materials used to construct a manufacturing or distribution facility with at least $100 million invested over an 18-month period are exempt from sales and use tax.  For a new or expanding recycling facility that invests at least $300 million, South Carolina provides certain exemptions from sales and use tax.For a new or expanding recycling facility that invests at least $300 million by the end of the fifth calendar year after the year in which the company begins construction or operation of the facility, South Carolina provides certain exemptions from sales and use tax.For a new or expanding recycling facility that invests at least $300 million by the end of the fifth calendar year after the year in which the company begins construction or operation of the facility, South Carolina provides certain exemptions from sales and use tax.For a new or expanding recycling facility that invests at least $300 million by the end of the fifth calendar year after the year in which the company begins construction or operation of the facility, South Carolina provides certain exemptions from sales and use tax.

Data Centers: Businesses that operate data centers may receive exemptions from sales and use taxes in exchange for investing at least $50 million (or $75 million at a multi-tenant facility) and creating at least 25 jobs with an average wage that is 150% of the county or state per capita wage, whichever is lower.

Property Tax Exemptions and Abatements: Pursuant to new legislation, 14.2857% of the property tax value of manufacturing property assessed for property tax purposes will be exempt from property taxation; provided, however, that the total amount of the exemption for all entities in the State for that fiscal year will not exceed $85 million.  For any year in which the amount is projected to exceed $85 million, the exemption amount shall be proportionally reduced.  This new exemption is being phased in in equal installments over six years beginning in 2018. Please note that this exemption does not apply to property under a Fee-in-Lieu agreement.

Additionally, South Carolina offers a five-year abatement from county operating taxes for new and expanding manufacturing and research and development facilities investing at least $50,000 in the facility.  Generally, the county’s operating portion makes up about 25% to 35% of the local millage rate. A five-year abatement does not apply to property under a Fee-in-Lieu agreement.

Fee-in-Lieu of Property Taxes (FILOT): Companies making a total capital investment of at least $2.5 million may negotiate with the county to obtain a lower assessment ratio and stabilize millage rates for up to 30 years.  By law, the company has five years to meet the minimum investment threshold, and the county can offer an additional five-year extension to complete the project.  Thus, all of the investment placed under the fee must be incurred within a maximum of ten years.  The company may include both real and personal property under the FILOT agreement.  However, property that has been on the tax rolls in the state previously, including existing buildings, is not eligible for the FILOT. (This restriction is waived for companies investing an additional $45 million or more in new investment.)

Under a FILOT, payments to local government are significantly reduced through the negotiation of a lower assessment rate from 10.5% to as low as 6%.  For certain large projects assessment ratios as low as 4% may be negotiated. The company may also negotiate a locked-in millage rate for up to 30 years or a five-year adjustable rate for the property that is subject to the FILOT.  With a FILOT, personal property depreciates, but real property is fixed at the original cost for the life of the fee.  However, the county and the company may instead provide that any real property subject to the FILOT may be reported at its fair market value as determined by the appraisal of the South Carolina Department of Revenue and may be re-appraised every five years.