York and Lancaster Counties Announce Updates to Local Sales & Use Taxes for 2025

The South Carolina Department of Revenue has issued Information Letter #25-1, outlining important updates to local sales and use taxes across the state. Effective March 1, 2025, these changes will impact residents, businesses, and tax professionals in counties statewide, including York and Lancaster counties.

Key Updates for York County:

1. Reimposition of the 1% Capital Projects Tax:
   • York County’s current 1% Capital Projects Tax, set to expire on April 30, 2025, will be reimposed starting May 1, 2025. This tax funds vital infrastructure and development projects, ensuring continued progress across the county.
2. Catawba Indian Reservation Tribal Tax:
   • The Catawba Indian Reservation, located in York County, aligns with state and local tax rates. Current rates include:
     • 7% for general sales of tangible personal property.
     • 8% for accommodations.
     • 0% for unprepared foods.
   • These rates may adjust in the future based on state or local tax changes.
3. Tax Exemptions and Benefits:
   • Purchases of unprepared food are exempt from the local sales and use tax.
   • Construction projects may qualify for a “grandfather clause” exemption on materials purchased under contracts signed before the new tax imposition date. Contractors must apply for an exemption certificate to take advantage of this benefit.

Key Updates for Lancaster County:

1. Continuation of the 1% Capital Projects Tax:
   • Lancaster County’s 1% Capital Projects Tax, which supports public infrastructure and community development, remains in effect. It will continue funding critical projects that benefit residents and businesses across the county.
2. Tax Exemptions:
   • Similar to York County, unprepared food remains exempt from Lancaster County’s local sales and use taxes.
   • Construction projects under qualifying contracts can also benefit from the “grandfather clause” exemption, helping businesses and contractors manage costs.

Broader Implications:

These tax adjustments are part of South Carolina’s broader initiative to manage funding for local projects, including transportation, education, and infrastructure development. Residents and businesses in York and Lancaster counties are encouraged to familiarize themselves with these changes to ensure compliance and proper financial planning.

For more details, consult the South Carolina Department of Revenue or review the full Information Letter #25-1 online. These updates underscore the importance of local taxes in supporting county development and maintaining essential services.