Transportation Sales Tax

2025-2026 Bill 979: Transportation Sales Tax - South Carolina Legislature Online

South Carolina General Assembly
126th Session, 2025-2026
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S. 979
STATUS INFORMATION
General Bill
Sponsors: Senators Sutton and Grooms
Document Path: SF-0031AA26.docx
Introduced in the Senate on March 5, 2026
Currently residing in the Senate Committee on
Finance
Summary: Transportation Sales Tax
HISTORY OF LEGISLATIVE ACTIONS

Date

Body

Action Description with journal page number

3/5/2026

Senate

Introduced and read first time (
Senate Journal-page 6
)

3/5/2026

Senate

Referred to Committee on
Finance
(
Senate Journal-page 6
)

View the latest
legislative information
at the website
VERSIONS OF THIS BILL
03/05/2026

A bill

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY AMENDING
SECTION
4-37-30
, RELATING TO SALES AND USE TAXES OR TOLLS AS REVENUE FOR
TRANSPORTATION FACILITIES, SO AS TO PROVIDE THAT THE GOVERNING BODY OF A COUNTY
MAY VOTE TO IMPOSE A TAX BY ENACTING AN ORDINANCE THAT MUST SPECIFY GREENWAYS,
ALL ACCOMPANYING INFRASTRUCTURE AND SERVICES NECESSARY TO PROVIDE ACCESS TO
THESE FACILITIES, AND DRAINAGE FACILITY MAINTENANCE AND CAPITAL IMPROVEMENTS
FOR FLOODING PREVENTION AND MITIGATION, AMONG OTHER ITEMS; AND TO PROVIDE THAT
A COUNTY MAY INCLUDE OPTIONAL BALLOT LANGUAGE FOR EXTENSION OF THE TERM OF THE
TAX OR FOR A REPLACEMENT PURPOSE FOR THE TAX.

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

S
ECTION 1.
S
ection
4-37-30
of the S.C. Code is amended to read:

S
ection
4-37-30
.
(
A)
To accomplish the purposes of this chapter, counties
are empowered to impose one but not both of the following sources of revenue:
a sales and use tax as provided in item
(A)
(B)
or to authorize an authority established by the
county governing body as provided in Section
4-37-10
to use and impose tolls in
accordance with the provisions of item
(B)
(C)
:

(A)
(
B)
Subject to the requirements of this section, the
governing body of a county may impose by ordinance a sales and use tax in an
amount not to exceed one percent within its jurisdiction for a single project
or for multiple projects and for a specific period of time to collect a limited
amount of money.

(
1)
The governing body of a county may vote to impose the tax authorized by this
section, subject to a referendum, by enacting an ordinance. The ordinance must
specify:

(
a)
the project or projects and a description of the project or projects for which
the proceeds of the tax are to be used, which may include projects located
within or without, or both within and without, the boundaries of the county
imposing the tax and which may include:

(
i)
highways, roads, streets, bridges, mass transit systems, greenbelts
and greenways
, and
all accompanying
infrastructure and services necessary to provide access to these facilities
including sidewalks, multipurpose paths, traffic signals, and relocation of
utilities;

(
ii)
other
transportation-related project
s
facilities
including, but not limited to, drainage facilities
and
drainage facility maintenance, and capital improvements for flooding prevention
and mitigation
relating to the highways, roads, streets, bridges,
mass transit systems, greenbelts and greenways,
and other
transportation-related projects;

(ii)
(
iii)
jointly-operated projects, of the type specified in
sub-subitem (i), of the county and South Carolina Department of
Transportation; or

(iii)
(
iv)
projects, of the type specified in sub-subitem (i),
operated by the county or jointly-operated projects of the county and other
governmental entities;

(
b)
the maximum time, stated in calendar years or calendar quarters, or a
combination of them, not to exceed twenty-five years or the length of payment
for each project whichever is shorter in length, for which the tax may be
imposed;

(
c)
the estimated capital cost of the project or projects to be funded in whole or
in part from proceeds of the tax and the principal amount of bonds to be
supported by the tax; and

(
d)
the anticipated year the tax will end.

(
2)
Upon receipt of the ordinance, the county election commission shall conduct a
referendum on the question of imposing the optional special sales and use tax
in the jurisdiction. A referendum for the initial imposition of the sales and
use tax within a county pursuant to this chapter and all subsequent referendums
to impose, extend, or renew the tax must be held at the time of the general
election. The commission shall publish the date and purpose of the referendum
once a week for four consecutive weeks immediately preceding the date of the
referendum in a newspaper of general circulation in the jurisdiction. A public
hearing must be conducted at least fourteen days before the referendum after
publication of a notice setting forth the date, time, and location of the
public hearing. The notice must be published in a newspaper of general
circulation in the county at least fourteen days before the date fixed for the
public hearing.

(
3)
A separate question must be included on the referendum ballot for each purpose
which purpose may, as determined by the governing body of a county, be set
forth as a single question relating to several of the projects, and the
question must read substantially as follows:

"
I approve a
special sales and use tax in the amount of (fractional amount of one percent)
(one percent) to be imposed in (county) for not more than (time) to fund the
following project or projects:

P
roject (1) for
___________ $ ___________

P
roject (2) for ___________ $____________, etc.

Y
es ____

N
o ____

P
roject
(2), etc
."

I
n addition, the
referendum, as determined by the governing body of a county, may contain a
question on the authorization of general obligation bonds under the exemption
provided in Section 14(6), Article X of the Constitution of South Carolina,
1895, so that revenues derived from the imposition of the optional sales and
use tax may be pledged to the repayment of the bonds. The additional question
must read substantially as follows:

"
I approve the
issuance of not exceeding $ ______ of general obligation bonds of ______
County, maturing over a period not to exceed ____ years to fund the ______
project or projects.

Y
es ____

N
o ____ "

I
f the referendum
on the question relating to the issuance of general obligation bonds is
approved,
then
the county may issue bonds in an
amount sufficient to fund the expenses of the project or projects.

(
4)
(
a) If a county has imposed a tax
pursuant to this chapter for less than the maximum twenty-five year term
allowed and the tax remains in effect,
then
the
governing body of the county at any time may call for a referendum to extend
the term of the tax for up to seven years, and thereafter call for referendums
to extend the term of the tax for up to seven years, for an aggregate total not
to exceed twenty-five years. The referendum to extend the term of the tax must
be held at the general election. A separate question must be included on the
referendum ballot for each purpose which purpose, as determined by the
governing body of a county, may be set forth as a single question relating to
several of the projects and the question must indicate whether the project is
an existing project or new project. A new project or projects only may be
listed on the ballot to the extent that the county has, or will, complete
existing projects. The question must read substantially as follows:

"
I approve the
extension of a special sales and use tax in the amount of (fractional amount of
one percent) (one percent) to be imposed in (county) not to exceed ____ years
to fund the completion of the following existing project or projects and/or to
fund the following new project or projects:

P
roject (1) for
__________ $ _____________ (new or existing)

Y
es ____

N
o ____

P
roject (2), etc."

A
county may include optional ballot language for
extension of the term of the tax or for a replacement purpose for the tax to
read as follows, if applicable:

"
This
is not a new tax."

(
b)
All qualified electors desiring to vote in favor of imposing the tax for a
particular purpose shall vote "yes" and all qualified electors opposed to
levying the tax for a particular purpose shall vote "no". If a majority of the
votes cast are in favor of imposing the tax for one or more of the specified
purposes, then the tax is imposed as provided in this section; otherwise, the
tax is not imposed. The election commission shall conduct the referendum
pursuant to the election laws of this State, mutatis mutandis, and shall
certify the result no later than November thirtieth after the date of the
referendum to the appropriate governing body and to the Department of Revenue.
Included in the certification must be the maximum cost of the project or projects
or facilities to be funded in whole or in part from proceeds of the tax, the
maximum time specified for the imposition of the tax, and the principal amount
of bonds to be supported by the tax receiving a favorable vote. Expenses of the
referendum must be paid by the jurisdiction conducting the referendum. If the
tax is approved in the referendum,
then
the tax is
imposed effective the first day of May following the date of the referendum. If
the reimposition of the tax pursuant to this article is approved in the
referendum,
then
the new or existing tax must be
imposed, extended, or renewed immediately following the termination of the
earlier imposed tax. If the certification is not made timely to the Department
of Revenue, the imposition is postponed for twelve months.

(
5)
The tax terminates on the earlier of:

(
a)
the final day of the maximum time specified for the imposition; or

(
b)
the end of the calendar month during which the Department of Revenue determines
that the tax has raised revenues sufficient to provide the greater of either
the cost of the project or projects as approved in the referendum or the cost
to amortize all debts related to the approved projects.

(
6)
When the optional sales and use tax is imposed, the governing body of the
jurisdiction authorizing the referendum for the tax shall include by definition
more than one item as defined in (a)(i) and (a)(ii) to describe the single
project or multiple projects for which the proceeds of the tax are to be used.

(
7)
Amounts collected in excess of the required proceeds first must be applied, if
necessary, to complete each project for which the tax was imposed. Any
additional revenue collected above the specified amount must be applied to the
reduction of debt principal of the imposing political subdivision on
transportation infrastructure debts
as authorized in this section

only.

(
8)
The tax levied pursuant to this section must be administered and collected by
the Department of Revenue in the same manner that other sales and use taxes are
collected. The department may prescribe the amounts which may be added to the
sales price because of the tax.

(
9)
The tax authorized by this section is in addition to all other local sales and
use taxes and applies to the gross proceeds of sales in the applicable
jurisdiction which are subject to the tax imposed by Chapter 36, Title 12 and
the enforcement provisions of Chapter 54, Title 12. The gross proceeds of the
sale of items subject to a maximum tax in Chapter 36, Title 12 are exempt from
the tax imposed by this section. The gross proceeds of the sale of food
lawfully purchased with United States Department of Agriculture food stamps are
exempt from the tax imposed by this section. For any tax authorized by this
section pursuant to a referendum held on or after November 5, 2024, unprepared
food items eligible for purchase with United States Department of Agriculture
food coupons may be exempt from the tax imposed pursuant to this section at the
election of the governing body of a county as may be provided in the
authorizing ordinance required by item (1). The tax imposed by this section
also applies to tangible personal property subject to the use tax in Article
13, Chapter 36, Title 12.

(
10)
Taxpayers required to remit taxes pursuant to Article 13, Chapter 36 of Title
12 must identify the county in which the tangible personal property purchase at
retail is stored, used, or consumed in this State.

(
11)
Utilities are required to report sales in the county in which consumption of
the tangible personal property occurs.

(
12)
A taxpayer subject to the tax imposed by Section
12-36-920
, who owns or manages
rental units in more than one county shall report separately in his sales tax
return the total gross proceeds from business done in each county.

(
13)
The gross proceeds of sales of tangible personal property delivered after the
imposition date of the tax levied pursuant to this section in a county, either
pursuant to the terms of a construction contract executed before the imposition
date, or a written bid submitted before the imposition date, culminating in a
construction contract entered into before or after the imposition date, are
exempt from the special local sales and use tax provided in this section if a
verified copy of the contract is filed with the Department of Revenue within
six months after the imposition of the special local sales and use tax.

(
14)
Notwithstanding the imposition date of the special local sales and use tax
authorized pursuant to this section, with respect to services that are billed
regularly on a monthly basis, the special local sales and use tax is imposed
beginning on the first day of the billing period beginning on or after the
imposition date.

(
15)
The revenues of the tax collected in each county pursuant to this section must
be remitted to the State Treasurer and credited to a fund separate and distinct
from the general fund of the State. After deducting the amount of refunds made
and costs to the Department of Revenue of administering the tax, not to exceed
one percent of the revenues, the State Treasurer shall distribute the revenues
and all interest earned on the revenues while on deposit with him quarterly to
the county in which the tax is imposed, and these revenues and interest
earnings must be used only for the purpose stated in the imposition ordinance.
The State Treasurer may correct misallocations by adjusting later
distributions, but these adjustments must be made in the same fiscal year as
the misallocations. However, allocations made as a result of city or county
code errors must be corrected prospectively.

(
16)
The Department of Revenue shall furnish data to the State Treasurer and to the
counties receiving revenues for the purpose of calculating distributions and
estimating revenues. The information which must be supplied to counties upon
request includes, but is not limited to, gross receipts, net taxable sales, and
tax liability by taxpayers. Information about a specific taxpayer is considered
confidential and is governed by the provisions of Section
12-54-240
. A person
violating this section is subject to the penalties provided in Section
12-54-240
.

(
17)
The Department of Revenue may promulgate regulations necessary to implement
this section.

(B)
(
C)
(
1)
(
a) This item
(B)
(C)
is intended to provide an additional and alternative
method, subject to a referendum, for the provision of and financing for
highways, roads, streets, and bridges, and other transportation-related
projects, either alone or in partnership with other governmental entities to
the end that these transportation-related projects may be undertaken in such
manner as may best be calculated to expedite relief of hazardous and congested
traffic conditions on the highways in the State, including the authorization
for turnpike projects undertaken by the Department of Transportation in Article
9 of Chapter 5 of Title 57. The Department of Transportation is prohibited
from removing funds previously dedicated to the project or designated county
area under its allocation formula based upon the fact that a county has passed
a referendum to impose the tax provided in this chapter.

(
b)
Subject to the requirements of this item
(B)
(C)
, the governing body of a county may by ordinance
authorize, subject to a referendum, an authority to use tolls to finance
projects authorized by this section.

(
c)
The ordinance enacted by the governing body of the county to authorize an
authority to use tolls must specify:

(
i)
the purpose for which the toll revenues are to be used which may include
jointly-operated projects between the authority and the South Carolina
Department of Transportation;

(
ii)
the maximum time, stated in calendar years or calendar quarters, or a
combination of them, not to exceed twenty-five years, for which the tolls may
be imposed; and

(
iii) the maximum cost of the project
or facilities to be funded in whole or in part from toll revenues and the
principal amount of bonds to be supported by the tolls.

(
d)
Upon receipt of the ordinance, the county election commission shall conduct a
referendum on the question of authorizing an authority to use tolls in the
jurisdiction. The referendum must be held on the first Tuesday occurring sixty
days after the election commission receives the ordinance. If that Tuesday is
a legal holiday then the referendum must be held on the next succeeding Tuesday
that is not a holiday. The commission shall publish the date and purpose of
the referendum once a week for four consecutive weeks immediately preceding the
date of the referendum, in a newspaper of general circulation in the
jurisdiction. A public hearing must be conducted at least fourteen days before
the referendum, after publication of a notice setting forth the date, time, and
location of the public hearing. The notice must be published in a newspaper of
general circulation in the county at least fourteen days before the date fixed
for the public hearing.

(
e)
A separate question must be included on the referendum ballot for each purpose
and the question must read substantially as follows:

"
I approve the
imposition of tolls on the following project or projects in (county) for not
more than (time) to fund the following project or projects:

P
roject (1)
for ___________ $ ___________

Y
es ____

N
o ____

P
roject (2)
etc."

(
f)
All qualified electors desiring to vote in favor of imposing tolls for a
particular purpose shall vote "yes" and all qualified electors opposed to
imposing tolls for a particular purpose shall vote "no". If a majority of the
votes cast are in favor of imposing tolls for one or more of the specified
purposes, then tolls are imposed as provided in this section; otherwise, an
authority is not authorized to impose tolls. A subsequent referendum on this
question, after the question is disapproved, must not be held more than once in
twenty-four months. The election commission shall conduct the referendum under
the election laws of this State, mutatis mutandis, and shall certify the result
no later than sixty days after the date of the referendum to the appropriate
county governing body and authority and to the South Carolina Department of
Transportation. Included in the certification must be the maximum cost of the
project or facilities to be funded in whole or in part from proceeds of the
tolls and the maximum time specified for the imposition of the tolls receiving
a favorable vote. Expenses of the referendum must be paid by the jurisdiction
conducting the referendum.

(
g)
Tolls terminate on the earlier of:

(
i)
the final day of the maximum time specified for the imposition; or

(
ii)
the end of the calendar month during which the authority determines that the
tolls have raised revenues sufficient to provide the greater of either the cost
of the project or projects as approved in the referendum or the cost to
amortize all debts related to the approved projects.

(h)
(
i)
When tolls are
imposed for more than one purpose, the governing body of the jurisdiction
authorizing the referendum for the tolls shall determine the priority for the
expenditure of the net proceeds of the tolls for the purposes stated in the
referendum.

(i)
(
ii)
Amounts collected in excess of the required proceeds
must first be applied, if necessary, to complete each project for which the
toll was imposed; otherwise, the excess amounts must be credited to the
general fund of the jurisdiction imposing the tax for infrastructure use only.

(
2)
If the voters have approved the imposition of tolls by referendum and if the
authority enters into a partnership, consortium, or other contractual
arrangement with the Department of Transportation relating to turnpike
facilities, the authority may designate, establish, plan, improve, construct,
maintain, operate, and regulate designated highways, roads, streets, and
bridges as "turnpike facilities" as a part of the state highway system or any
federal aid system whenever the authority determines the traffic conditions,
present or future, justify these facilities. Under such partnership
arrangement, the authority may utilize funds available for the maintenance of
the state highway system for the maintenance of any turnpike facility financed
pursuant to this chapter. If the authority determines it is feasible to make
all or part of a construction project a turnpike facility, it may engage in the
preliminary estimates and studies incident to the determination of the
feasibility or practicability of constructing any toll road as it from time to
time considers necessary and the cost of the preliminary estimates and studies
may be paid from the general highway fund and must be reimbursed from funds
provided under this chapter only if the studies and estimates lead to the
construction of a toll road.

(
3)
Under the partnership arrangement, the authority may acquire such lands and
property, including rights of access as may be needed for turnpike facilities,
by gift, devise, purchase, or condemnation by easement or in fee simple as
authorized by law on or after the effective date of this chapter for acquiring
property or property rights in connection with other state highways.

(
4)
In designating, establishing, planning, abandoning, improving, constructing,
maintaining, and regulating turnpike facilities, the authority may exercise
such authorizations as are granted generally to the Department of
Transportation by the statutory law applicable to the state highway system,
except as they may be inconsistent with the provisions included in this
chapter.

(
5)
Whenever it becomes necessary that monies be raised for the transportation
facilities described in this chapter, the authority may issue toll revenue
bonds in a principal amount not to exceed the amount authorized in the
referendum to authorize the authority to impose tolls to provide all or a
portion of the cost of these facilities and maintenance of the toll road after
adopting its resolution setting forth the following:

(
a)
the toll facility proposed to be constructed;

(
b)
the amount required for feasibility studies, planning, design, right-of-way
acquisition, and construction of the toll facility;

(
c)
a tentative time schedule setting forth the period of time for which the toll
shall be imposed and set forth a schedule for elimination of all or part of all
tolls;

(
d)
a debt service table showing the estimated annual principal and interest
requirements for the proposed toll revenue bonds;

(
e)
any feasibility study obtained by the authority relating to the proposed toll
facility;

(
f)
any covenants to be made in the bond resolution respecting competition between
the proposed toll facility and possible future highways whose construction
would have an adverse effect upon the toll revenues which would otherwise be
derived by the proposed toll facility;

(
g)
any additional revenue collected above the specified amount to satisfy the
principal and interest of toll revenue bonds or maintenance must be applied to
the reduction of debt principal of the imposing political subdivision.

(
6)
In addition to the powers listed above, the authority may in connection with
such toll facilities:

(
a)
fix and revise from time to time and charge and collect tolls for transit over
each turnpike facility constructed by it;

(
b)
combine for the purpose of financing the facilities any two or more turnpike
facilities;

(
c)
control access to turnpike facilities;

(
d)
to the extent permitted by a bond resolution, expend turnpike facility revenues
in advertising the facilities and services of the turnpike facility or
facilities to the traveling public;

(
e)
receive and accept from any federal agency grants for or in the aid of the
construction of any turnpike facility;

(
f)
do all acts and things necessary or convenient to carry out the powers
expressly granted in this chapter;

(
g)
enter into contracts with the Department of Transportation for sharing the cost
of building and the revenues derived from the facilities authorized in this
chapter and for the operation and maintenance of the facilities for
transportation infrastructure debts only.

(C)
(
D)
It is intended that this chapter is an additional and
alternative method of financing highway and bridge projects to those already
provided under the provisions of the State Highway Bond Act (Section
57-11-210
), the State Turnpike Bond Act (Section
57-5-1310
et seq.), the
Revenue Bond Act for Utilities (Section
6-21-10
et seq.), and Section
4-9-30
(5).

(D)
(
E)
The Department of Transportation must not diminish or
decrease funds available to a municipality, county, or multi-county area
because a project has been funded in the municipality, county, or multi-county
area pursuant to a referendum provided in this chapter.

S
ECTION 2. This act takes effect upon approval
by the Governor.

----XX----

This web page was last updated on March 5, 2026 at 11:44 AM