Agricultural products purchase credit
South Carolina offers a tax credit to encourage agribusiness and agricultural packaging operations to increase their purchases of agricultural products grown in South Carolina.
Eligible companies may receive either an income tax credit or a withholding tax credit based on increased purchases of certified South Carolina agricultural products.
Eligibility requirements
To qualify for the credit, a company must:
- Operate as an agribusiness or agricultural packaging operation;
- Establish a base year in which the company purchases more than $100,000 of agricultural products certified as grown in South Carolina by the South Carolina Department of Agriculture (SCDA); and
- Increase the number of agricultural units purchased in the following year by at least 15% over the base-year unit total.
After the initial base year is established, the base-year unit amount is recalculated annually.
Credit amount and limitations
The type and amount of credit are determined by the South Carolina Coordinating Council for Economic Development (Coordinating Council) based on recommendations from the SCDA.
Key limitations include:
- The credit may not exceed $100,000 per taxpayer in any one year.
- The total credits available to all qualifying companies are limited to $2,000,000 per year.
If the full credit cannot be used in the year it is awarded, any unused portion may be carried forward for up to five years.
Application process
Companies must submit an application to the Coordinating Council no later than September 30 of the year following the increase in purchases.
Applications are reviewed by staff of the Coordinating Council and the SCDA to determine eligibility.
Based on SCDA’s recommendation, the Coordinating Council determines:
- Whether the company qualifies;
- The type of credit awarded; and
- The amount of credit available.
Frequently asked questions
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