County property owners likely to pay slightly higher taxes

By: Arlie Porter of The Post and Courier Staff
Originally Published on: 5/20/03

Local businesses changing way they report sales tax receipts Charleston County property owners will likely pay slightly higher taxes this year as a result of local businesses changing the way they report sales tax receipts, according to county officials. The change will likely add $4 to $12 to a tax bill on a $200,000 home, according to County Controller Harold Bisbee. Voters narrowly approved a local option sales tax increase more than a decade ago. Since then, residents have paid an additional one-cent sales tax, which elected officials said would be applied to rolling back property taxes. Businesses report their sales tax receipts to the state, which returns most of the money to the county and local municipal governments. Those governments, in turn, apply the money to property tax bills in the form of a rebate. While over the years local businesses have reported the county in which they are located, they have not always reported the municipality they are in. The cities of Sumter and North Charleston complained, saying that sales tax proceeds from businesses in their cities are instead going to the county. The S.C. Department of Revenue responded by requesting businesses to list the municipality in which they are located as well as the county. This means that Charleston County will receive from $500,000 to $1.5 million less in sales taxes this year, and municipalities will collect more, Bisbee said. Because the county will collect less in sales taxes, the county sales tax rebate on a $200,000 home will be $4 to $12 less on tax bills this year than last year, Bisbee predicted. Tax bills normally are mailed at the end of September. Over the years, Charleston County has applied all of the sales tax receipts toward property tax relief, Bisbee said. This has not always been the case with municipal governments, however. By law, governments are required to use 71 percent of the sales tax money toward rolling back property taxes. The rest can be used to cover higher government spending. The county will carefully study reporting of the sales tax to ensure the county is getting its proper share, Bisbee said. "We're going to scrub the hell out of the numbers before we agree to them," Bisbee said. Bisbee blamed businesses for not having reported their specific address to the state for the change in the Revenue Department accounting procedures. "It's sloppy reporting on the part of businesses," he said. Danny Brazell, a Revenue Department spokesman, said several municipalities have complained over the years. "Although it has not been a great problem, it does have the potential to be a problem statewide," he said.

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