COLUMBIA, S.C. - Governor Henry McMaster and S.C. Department of Employment and Workforce (DEW) Executive Director Cheryl Stanton announced that the 2019 tax rates for businesses will be an average of 18.8 percent lower than in 2018 – the largest decrease in the rates so far, putting $52 million back into businesses’ pockets. This is the sixth consecutive year DEW is cutting rates for South Carolina businesses while still rebuilding the trust fund.
“Since 2017, tax rate cuts have saved businesses $102 million to reinvest in their workforce and in our state’s economy,” said Gov. Henry McMaster. “The cuts for 2019 represent $52 million in savings and they are a direct result of the growing economy and the support of the business community. This shows that our state is committed to making it easier for companies to do business here so they will continue to create jobs and invest in South Carolinians.”
Tax rate notices will be mailed to businesses in the beginning of November and will also be available in an employer’s State Unemployment Insurance Tax System (SUITS) account next week. A guide showing how to access this rate can be found here. All liable South Carolina businesses receive a tax rate based on their usage of the system.
“Five years ago, it was critical that we rebuild the unemployment trust fund which was impacted by the Great Recession. With the cooperation of the General Assembly, South Carolina businesses and DEW, a plan was created to grow the unemployment insurance fund back to a state of stability and strength,” the governor said. “Conducted with careful intention and determined purpose, we have been able to maintain our fiscal objective and cut taxes so businesses can continue to thrive here and bolster our economy."
A new business, which qualifies for tax rate class 12, with 100 employees who paid wages of at least $14,000 per year per worker would pay $3,080 less in unemployment taxes in 2019 than they did in 2018. The tax rate is a formula based on projected benefit costs for the year and the projected amount required to help rebuild the trust fund balance by 2020.
“With more than 2.23 million South Carolinians working and the unemployment rate at 3.3 percent, the lowest in the state’s recorded history, these cuts come at a time when businesses are looking for unique and innovative ways to enhance and expand their workforce,” said Cheryl Stanton, DEW’s executive director. “DEW, the State Workforce Development Board and the governor’s office continue to work purposefully with employers to develop and offer programs and services related to creating and fostering a workforce that is prepared to fill jobs and bolster success for everyone.”
During the Great Recession, South Carolina needed to borrow nearly $1 billion from the federal government in order to provide unemployment benefits. The agency, however, was able to pay off the loan early saving businesses $12 million. After the loan was paid off in 2015, the Legislature passed a regulation that requires DEW to rebuild the trust fund within five years to a level that will cover the potential benefit needs without borrowing from the federal government. The agency is in the fourth year of that effort.
Click here to view the 2019 tax rate chart.