Taxes in South Carolina: Features and Advantages

Main Taxes in South Carolina

Income Tax

South Carolina levies a progressive personal income tax. Rates range from 0% to 6.5% depending on income level. Since 2023, a gradual reduction program has been in place to make the state’s tax system more competitive. The state also provides deductions and credits, including for retirees and homeowners.

Sales Tax

The base sales tax rate in South Carolina is 6%. Counties may add local surtaxes, bringing the total rate up to 9%. Sales tax applies to most goods and certain services, including rentals and repairs. The state has specific rules for taxing online sales, subscription deliveries, and remote services.

We provide services for business registration, obtaining a Sales Tax Certificate, preparing and filing Sales and Use Tax Returns, and advising entrepreneurs on registration, rate calculation, and reporting requirements.

Property Tax

Property tax rates vary by property type and location. For residential property (primary residence), the effective rate is about 0.56%, making the state relatively affordable for homeowners.

Rates are higher for commercial property or rental properties.

Business Taxes

South Carolina levies a Corporate Income Tax at 5% of taxable profits. This applies to C corporations, while S corporations and LLCs are exempt from corporate tax but must file annual reports.

Companies operating in South Carolina must file a Public Information Report annually by May 15.

Excise Taxes

South Carolina levies excise taxes on goods such as gasoline, alcohol, and tobacco. In recent years, rates have increased, particularly on fuel, to fund infrastructure projects.

Favorable Tax Conditions in South Carolina

• South Carolina offers a moderate tax burden and attractive conditions for business operations.
• Progressive income tax reduces the burden on low- and middle-income earners.
• Low corporate income tax rate, especially compared to other states.
• Simplified reporting for LLCs and S corporations.
• The state actively attracts companies with tax incentives for investors, manufacturers, and startups.

Taxes in South Carolina Compared to Other States

• Unlike Florida, South Carolina has an income tax, but it is lower than in California or New York.
• Unlike Texas, South Carolina has no franchise tax, reducing administrative burdens on businesses.
• The base sales tax rate is similar to most southern states but can increase with local surtaxes.
• Property tax is below the national average, especially for primary residences.
• Unlike Florida, commercial property rentals are not subject to sales tax, reducing business costs.
• South Carolina does not levy tax on personal tangible property of individuals.
• Businesses must pay tax on tangible personal property if equipment and assets exceed the set threshold.