Small Business Livable Wage Tax Credit Act

2025-2026 Bill 4603: Small Business Livable Wage Tax Credit Act - South Carolina Legislature Online

South Carolina General Assembly
126th Session, 2025-2026
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H. 4603
STATUS INFORMATION
General Bill
Sponsors: Reps. Jones, Spann-Wilder and White
Document Path: LC-0388SA26.docx
Introduced in the House on January 13, 2026
Currently residing in the House
Summary: Small Business Livable Wage Tax Credit Act
HISTORY OF LEGISLATIVE ACTIONS

Date

Body

Action Description with journal page number

12/16/2025

House

Prefiled

12/16/2025

House

Referred to Committee on
Ways and Means

1/13/2026

House

Introduced and read first time (
House Journal-page 34
)

1/13/2026

House

Referred to Committee on
Ways and Means
(
House Journal-page 34
)

1/20/2026

House

Member(s) request name added as sponsor: White

View the latest
legislative information
at the website
VERSIONS OF THIS BILL
12/17/2025

A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ENACTING THE
"SMALL BUSINESS LIVABLE WAGE TAX CREDIT ACT" BY ADDING SECTION
12-6-3830
SO AS
TO PROVIDE FOR AN INCOME TAX CREDIT FOR CERTAIN QUALIFIED EMPLOYERS WHO PAY
NONEXEMPT EMPLOYEES AT OR ABOVE THE LIVABLE WAGE.

B
e it enacted by the
General Assembly of the State of South Carolina:

S
ECTION 1.
This act may be cited as the "Small Business Livable Wage Tax Credit Act."

S
ECTION 2.
T
he General Assembly finds that:

(
1) Small
businesses employ approximately forty-three percent of South Carolina's
workforce.

(
2) Small
employers are the backbone of the state's economy and deserve support in
remaining competitive.

(
3) Voluntary
incentives, not mandates, are the most effective way to encourage free-market
adoption of higher wages.

(
4) Employees
who earn a livable wage contribute more in state and federal income taxes,
strengthening the tax base and reducing reliance on public assistance.

(
5) A
temporary, declining tax credit will allow small businesses time to adjust
pricing, productivity, and operations while raising wages.

S
ECTION 3.
A
rticle 25, Chapter 6, Title 12 of the S.C. Code is
amended by adding:

S
ection
12-6-3830
.
(
A) As used in this
section:

(
1)
"Qualified employer" means a business entity registered in this State that:

(
a)
employs fewer than fifty employees;

(
b)
is in good standing with the Secretary of State; and

(
c)
elects to participate in this program voluntarily.

(
2)
"Livable wage" means the hourly wage rate published annually by the MIT Living
Wage Calculator, or a successor source approved by the Department of Employment
and Workforce, specific to the county in which the employee works.

(
3)
"Incremental wage cost" means the difference between the federal minimum wage
and the livable wage, multiplied by the total hours worked by covered
employees.

(
B)
(
1) A qualified employer may claim a
credit against income or payroll taxes equal to the incremental wage cost of
paying employees at or above the livable wage.

(
2)
In the first year in which the credit is earned, the amount of the credit is one
hundred percent of the incremental wage cost. Thereafter, the credit is seventy-five
percent of incremental wage cost in the second year, fifty percent of
incremental wage cost in the third year, and twenty-five percent of incremental
wage cost in the fourth year. The credit may not be claimed beyond the fourth
year.

(
3)
Unused credit may be carried forward for two years.

(
C)
To qualify for the credit, an employer must:

(
1)
maintain or increase headcount relative to the previous tax year;

(
2)
pay all nonexempt employees at or above the livable wage;

(
3)
submit annual payroll verification to the Department of Revenue; and

(
4)
remain current on all state tax obligations.

(
D)
Participation in the tax credit is voluntary.

(
E)
(
1) The department shall promulgate
regulations as necessary to implement the provisions of this section.

(
2)
The department shall publish an annual summary report including:

(
a)
number of participating employers;

(
b)
number of employees paid livable wages;

(
c)
total credits claimed; and

(
d)
estimated increase in individual state income tax revenue from employees.

(
3)
Individual employer payroll data may not be publicly disclosed.

S
ECTION 4. This act takes effect upon approval
by the Governor and first applies to income tax years after 2025. The
provisions of Section
12-6-3830
are repealed on December 31, 2035. Any
carryforward credits shall continue to be allowed until the two-year time
period is completed.

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This web page was last updated on January 13, 2026 at 2:42 PM