The law requires these standardization measures of cities and towns with the tax by January 1, 2022:
- License periods beginning May 1 and ending April 30.
- Calculating the tax based on a business’ gross income for the previous calendar year or its previous fiscal year.
- Using the law’s definition of gross income.
- Accepting a standardized application approved by the SC Revenue and Fiscal Affairs Office.
- Using the law’s standardized class schedule.
- Allowing businesses to make license renewal payments through an online payment system hosted by the SC Revenue and Fiscal Affairs Office.
- Using the law’s standardized appeals process.
- Setting rates for the 2022 license year — May 1, 2022, to April 30, 2023 — to prevent any revenue windfall for the taxing jurisdiction during the first year of compliance.
During 2021, cities and towns will need to adopt business license ordinances that comply with the new law. The Municipal Association strongly recommends cities and towns repeal their existing ordinances and then replace them the Association’s 2021 model business license ordinance, which will be available soon.
Achieving compliance with the new law will require a phased approach. Throughout 2021, the Municipal Association’s staff will work to help municipal staff comply with the new requirements. Here are a few resources for getting started:
- Business License Standardization Is the Law — Now What? – This Uptown article explains the first steps cities need to take. This includes assigning the North American Industry Classification System code, or NAICS code, to businesses before reviewing data.
- Business License Standardization Basics – In this podcast, Director of Advocacy and Communications Scott Slatton examines the new law’s requirements and what the compliance process will look like in 2021.
- Standardization and Business License Data – This podcast features Manager for Collection Programs Caitlin Cothran discussing codes assignment and data preparation.