Request for regulatory review:

Admissions/Theater tax return Form L-511

SC Revenue Procedure #91-1

We are presenting this petition in hopes of making a change that could benefit the economies of South Carolinas tourism markets. As you know, trade show and convention events currently are required to complete form L-511, along with 5% of ticket sales, in addition to South Carolina sales taxation of 6% of gross sales, and in many cases, added local taxes. This practice has led to many trade show and convention events seeking refuge in locations outside of South Carolina’s borders over time.

The current regulations are placing an undue burden on the organizations responsible for organizing these types of events, and are in turn impacting South Carolina’s tourism market. The limited activities of these events in this state translate into lost revenue for hotels, food service providers, and even small local businesses. The situation could be much different, and beneficial to us all.

In addition, the policies of SC Revenue Procedure #91-1 should also be reviewed. This document from January of 1991 details requirements of taxation on special events and trade shows. This position is costing South Carolina far more in tax revenue than most are aware of.

As with form L-511, this has resulted in limited participation of traveling merchants, impacting hotels and food service industries. It is most damaging to artists and craftsmen, people who often do not see much of a return on their goods.

To remain competitive, South Carolina must review these aggressive taxation policies. Some of us have attempted to introduce new special trade show type events to this state, and we are quickly finding out why previous shows no longer exist. The lost tourism far outweighs the current taxes collected in our market.

-   Eliminate sales tax requirements on exhibitors of trade shows. This encourages more traveling merchant participation, and stimulates tax collection in other local markets. (Dining, hotels, fuel purchases – all of which equal more tax dollars for the State of South Carolina than the exhibitors in most cases - Without participation of trade show exhibitors, none of the taxes are collected.)

-   Clarify requirements of taxation for trade show organizers. The current SC Dept. of Revenue offers conflicting information, depending on the individual reviewing your event, often on high risk ventures with low return.

-   Encourage growth of independent arts and crafts.

-   Encourage economic development of local markets within our communities.

By changing these restrictions, or by adding specific provisions for trade shows and conventions, we can achieve a much stronger future. Comparison of nearby markets clearly illustrates what is possible.