Orangeburg County considers business licensing
June 13, 2017
Orangeburg County, SC
By John Mack | T&D Staff Writer
Orangeburg County Council is considering requiring businesses to obtain a license.
County Administrator Harold Young said a business license would bring “additional revenue and that would save us from having to increase millage.”
Council members discussed implementing a business license program during a budget work session last week.
“Right now there is nothing in the county,” Planning Director Richard Hall said. “If a business is in the city and they do work in the county, the city collects all that money because we don’t have a business license.”
The county is considering a plan with a varying rate, depending on the type of business. On average, businesses would pay $1 per $1,000 in revenue for companies making less than $1 million.
“There’s a declining rate structure built in for businesses making over a million dollars, which would hit a lot of the industrial stuff,” Hall said.
He noted that there are currently 1,750 businesses with gross sales of $1.2 billion. If averaged, this would mean each business makes around $719,000.
Hall said based on that number, it could mean additional revenue for the county of almost $1.3 million in business license taxes.
“We feel like this is a low number,” he added.
Hall said city had roughly $1.1 million in revenue from business license taxes last year.
“It’s about 12 percent of the finance department’s budget,” he said.
Hall said the county gets calls weekly from businesses asking how much they owe the county for a business license.
“We just tell them we don’t have one,” Hall said.
Councilwoman Janie Cooper-Smith said, “We’re losing revenue right there.”
Councilman Harry Wimberly asked if businesses would need to pay for both the city’s business license and the county’s.
“If they have a business that’s inside the city limits and they do work in the county, they pay a percentage for the work they did in the county to the county,” Hall said. “That comes off of their city business license.”
Cooper-Smith asked how the license would work for peddlers.
“It’s a combination effort,” Hall said. “You write the people that are out there without a license a ticket.”
She also asked, “How hard is it to get a business license?”
Hall said a business license is “really just a formality.”
“For a peddler, it doesn’t matter,” he added. “You come in and you fill out a piece of paper and you apply for it at the county.”
Businesses must go through a process, which includes the county ensuring that the business meets the zoning requirements for its property.
Wimberly asked about agricultural businesses.
“We don’t have a profit margin,” he said. “When I carry a crop to market, I get paid what they say, not what I say.”
“I may have a gross income of a million dollars, but I might have a profit margin of 1 percent and you’re going to take 2 percent of that for business taxes,” Wimberly added.
Hall said it would be an easy fix to adjust who pays what.
“The business license, it’s not a tax on profit or anything like that, it is a fee for your ability to do business in a jurisdiction,” he said. “We would just have to determine what all businesses fit into that category that you want.”
Wimberly suggested a flat fee for agricultural businesses that grow products, not including agriculture-related businesses such as Super Sod.
Hall said the county will look at how other counties have been handling agricultural businesses.
If council approved the business licenses over the course of three readings and the public heating, the licenses could go into effect on Jan. 1.
Council members felt they should push to have it sooner for prospective businesses.
“You’ve got to look at what’s coming,” Wimberly said. “If they come, we’ve got to have it July 1.”
“Whatever we’ve got to do to have it July 1, we need to do it,” Councilman Clyde Livingston said. The county could lose revenue from contractors who do spot work after July 1.
Young said, “Even if you pass it July 1, we don’t have the infrastructure in place to back it up right now anyway.”
Hall said the county would need to find and purchase necessary software, get ready for billing and hire a business license director.
Council directed staff to research the possibility of passing the ordinance before the next fiscal year and holding first reading at the next council meeting.
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