Bill
H 3379
Exempts sales to 501(c) nonprofit organizations from state sales tax, affecting nonprofits, retailers, and government revenue.
Status and procedure
- Bill number: H 3379
- Title (as provided): Nonprofit sales tax exemption
- Current status: Referred to Committee on Ways and Means; hearing scheduled 07/22/2025 (10:00 AM–1:00 PM, A‑1). Prefiled 12/05/2024; introduced/read first time 01/14/2025; referred to Ways and Means 01/14/2025; referred to State Administration and Regulatory Oversight 02/27/2025. (Document also notes “Senate concurred” 02/27/2025.)
- Effective date (in the bill text): July 1, 2025.
Note on source material
- The legislative text supplied includes material from two different contexts (a Massachusetts “Act relative to Treasury operations” and a short South Carolina amendment). The sales‑tax exemption language appears to be the South Carolina draft amendment to S.C. Code § 12‑36‑2120. Confirm jurisdiction with the sponsoring office before relying on procedural details.
Purpose and intent
- To exempt retail sales made to nonprofit organizations that are federally tax‑exempt under Internal Revenue Code section 501(c) from state sales tax.
Key provision (exact statutory change)
- Adds a new subsection (85) to S.C. Code § 12‑36‑2120 specifying: “sales made to a nonprofit organization that is exempt from federal income tax pursuant to Section 501(c) of the Internal Revenue Code” are exempt from sales tax.
Who would be affected
- Nonprofit organizations that hold federal tax‑exempt status under IRC § 501(c): they would be exempt from paying state sales tax on purchases covered by this provision.
- Retailers and vendors: would need to implement procedures to accept and document tax‑exempt purchases and may remit less sales tax to the state.
- State and local governments: potential reduction in sales tax revenue; impact depends on the scope (which 501(c) categories are included) and the dollar volume of purchases by affected nonprofits.
Practical and fiscal considerations
- The bill text does not specify documentation or verification procedures for sellers (e.g., exemption certificates), nor which 501(c) subsections are included or excluded. Administrative rules or implementing guidance would likely be needed to operationalize the exemption.
- Fiscal impact is not specified in the text; exempting purchases to all 501(c) organizations could reduce state sales tax receipts. A revenue estimate from the state’s budget office would be needed.
- Potential secondary impacts: lower operating costs for nonprofits, which could increase programmatic spending; possible need for audit/compliance resources to prevent improper claims.
Next steps for readers
- Verify the bill’s jurisdiction (South Carolina vs. Massachusetts) and consult the committee docket for updates or fiscal notes prior to the 07/22/2025 hearing.
- For stakeholders (retailers, nonprofits, municipal finance officers), monitor implementing guidance that would define verification and recordkeeping requirements.
Compiled from official sources — confirm details with the bill’s official record.
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