Tax rate cuts announced for SC businesses for third year in a row

COLUMBIA, S.C. (WCSC) - For the third year in a row, unemployment insurance tax rates will either decrease or remain the same for South Carolina employers in 2024.

Gov. Henry McMaster and the state’s Department of Employment and Workforce made that announcement Monday morning. McMaster credited the announcement to the partnership between SCDEW, the Governor’s Office and the General Assembly.

“There is no better time to be in business in South Carolina. The state’s leadership has worked hard to make strong financial decisions that maintain a healthy unemployment insurance trust fund which will benefit employers in the coming year,” McMaster said. “With a growing economy, a stable trust fund balance, and lower business tax, South Carolina proves once again that it is the ideal destination for business development and success.”

The state’s unemployment insurance trust fund’s balance of $1.6 billion allowed the state to set 2024 tax rates to raise approximately the same level of revenue for the past two years. It also translated to lower rates for rate classes 2 through 19 by an average of 6% compared to 2023 levels. Classes 1 and 20 are set by statute and do not change year to year, according to a release from McMaster’s office.

“Strong economic and wage growth have played a crucial role in maintaining our trust fund balance above the required threshold,” SCDEW Director William Floyd said. “Our agency is committed to building the workforce, facilitating job placement, and supporting employers. Our unemployment rate has steadily declined and now matches the low 2.9% rate of February 2020. And we have a record number of people working in South Carolina with one of the fastest growing labor forces in the country.”

Although tax rates for most tax classes are lower than their 2023 levels, individual businesses may still move between classes based on their unemployment claim activity, the release states.

All businesses with charges against their accounts are provided a “charge statement” quarterly to review and have 30 days to protest any charges that they do not believe should be on their account. Tax rate notices will be mailed to businesses on Nov. 13, but as of last Friday, employers can log into their State Unemployment Insurance Tax System account to see their 2024 tax rate.

The governor’s office said lower taxes are not the only way the state is helping businesses, citing the Statewide Education and Workforce Development Act, which will improve the state’s responsiveness to industry needs by aligning workforce development activities and providing real-time labor market information and analysis to drive workforce decisions. That information is available to employers through the SUITS software.

Click here to view the 2024 tax rate chart.

Copyright 2023 WCSC. All rights reserved.