South Carolina isn’t a particularly large state, but we have more than 220 cities and seven counties with separate requirements and processes for issuing business licenses. Each has its own unique system and due dates. Worse still, companies regardless of size are required to hold a license in every municipality and county where they have sales; larger operations may have to maintain more than 25 separate licenses simultaneously. Can you imagine it?
The original intent of licensing was to keep track of what kind of businesses were operating in our state. What started as a helpful practice, however, has become unwieldy and unnecessarily complex. In fact, the current system actually punishes companies seeking to comply, because the proliferation of municipalities and counties overseeing licensing, classifications, forms, fees and deadlines means that the requirements change regularly, at the whim of a jurisdiction.
Columbia councilman wants some nonprofits to pay a business license fee
The bottom line is that the process of obtaining and renewing business licenses in South Carolina has become a major obstacle. Some companies, like Blue Ridge security in Anderson, have literally moved a few blocks away to save tens of thousands of dollars in licensing fees. Many small-business owners have come to talk to legislators about the penalties, enforcement and difficulty they have working within the current licensing requirements. We all want to see business growth and job creation, but the system we have now clearly is hindering instead of helping.
That is why I introduced a bill to reform business licensing by providing a clearer, streamlined system. My goal is to encourage business license compliance, and, ultimately, economic growth and job creation. By making compliance easier, we allow businesses to focus on growing and building, rather than handling numerous payments, requirements and deadlines with a variety of government entities.
H.4967 has three major components:
1. Uniform collection date. Since many companies are required to maintain licenses in several municipalities, the bill would set one fee collection date for all businesses, regardless of locality. Also, all companies would be able to complete a single form and pay online.
Columbia property owners to get breaks to fix flood-damaged homes, businesses
2. All fees paid to the S.C. Department of Revenue. The bill would create one place for people to renew and pay for business licenses. Centralizing payments and processing keeps confidential tax information from being shared with multiple entities. Companies already have tax information on file with the Revenue Department and would not have to submit it to other agencies as they do now. This also allows the Revenue Department to maintain a centralized presence to assist companies in compliance.
3. No more penalizing one company for another’s problems. In some situations, a company can be penalized if a subcontractor has compliance problems. For example, a general contractor may not receive a certificate of occupancy if a subcontractor has an expired business license. That is unfair. This bill would ensure that companies are responsible only for their own business licenses.
SC House member seeks to cap local fees; his home town balks
My bill quickly gained 34 co-sponsors, indicating that many of my colleagues recognize its potential value for economic growth. A streamlined, efficient and customer-focused licensing process would be a welcome change for our businesses.
The time is now for our state government to send the clear message that we care about the welfare of all our citizens, by implementing a business licensing system that encourages compliance through simplicity. It’s time to stop penalizing companies and hindering job creation with a system that is far too complex.
Mr. Atwater represents Lexington County in the S.C. House; contact him at firstname.lastname@example.org.