What sales and use tax exemptions were available to qualifying motion picture companies under South Carolina's 2008 guidance?

Plain-English summary

The ruling described two South Carolina sales and use tax exemptions for motion picture companies. The broader incentive under Title 12, Chapter 62 applied to a qualifying production company that intended to spend at least $250,000 in South Carolina within a consecutive 12-month period, applied before filming, received approval and written certification, and obtained a Department exemption certificate.

That certified-company exemption covered qualifying purchases and rentals of taxable property and services used in connection with South Carolina filming or production. It applied to state sales and use taxes and local sales and use taxes administered by the Department of Revenue, but not directly administered local hospitality or accommodations taxes and not the listed non-sales-tax surcharges and excise taxes.

A second, narrower exemption under S.C. Code § 12-36-2120(43) could apply even when a company did not meet the $250,000 incentive threshold. It covered supplies, technical equipment, machinery, and electricity used and consumed directly and predominantly in filming or producing motion pictures. It did not cover administrative use, cast or crew personal purchases, or purchases by independent service providers.

What this means for you

Production companies seeking the broader exemption

The company had to apply before filming, estimate South Carolina expenditures, designate a representative, receive approval, and use the issued exemption certificate. If it failed to spend $250,000 within 12 months, the ruling made the company liable for the taxes that would have been paid, with a 60-day penalty-free payment period but interest still due.

Smaller or uncertified productions

The narrower exemption could still protect qualifying production supplies, equipment, machinery, and electricity, but not the wider list of taxable services and charges covered by the certified incentive.

Vendors and contractors

Only the production company named on the certificate could use it. Cast, crew, subcontractors, and other service providers could not use the company's certificate for their own purchases.

Common questions

Q: What productions counted under the broader incentive?
A: The ruling included qualifying feature films, videos, television series, commercials, and television pilots intended for national theatrical or television viewing, while excluding news and athletic-event coverage and the specified productions subject to 18 U.S.C. § 2257 records.

Q: Did the broader exemption cover rentals and taxable services?
A: Yes. The ruling treated sales broadly enough to include rentals, leases, licenses to use, and other taxable transfers, and listed many taxable production purchases and services.

Q: Did it cover directly imposed local hospitality or accommodations tax?
A: No. It covered local sales and use taxes administered and collected by the Department, not those directly administered by local governments.

Q: Could subcontractors use the production company's certificate?
A: No. The certificate was limited to the named motion picture production company.

Q: What if the production missed the $250,000 threshold?
A: It became liable for the sales and use taxes that would have applied, although the statute provided the described 60-day period to pay without penalties.

Citations and references

• S.C. Code §§ 12-62-20, 12-62-30, and 12-62-40 (definitions, certified-company exemption, application, certification, and recapture)
• S.C. Code § 12-36-2120(43) (narrower supplies, equipment, machinery, and electricity exemption)
• S.C. Code §§ 12-36-60 and 12-36-100 (tangible personal property and sale definitions)
• S.C. Code § 12-54-25 (interest on unpaid tax after failure to meet the expenditure requirement)
• Senate Bill 1171 of 2008 (agency-transfer amendments addressed by the ruling)

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/RR08-12.pdf

Original ruling text

State of South Carolina

Department of Revenue
301 Gervais Street, P. O. Box 125, Columbia, South Carolina 29214
Website Address: http://www.sctax.org

SC REVENUE RULING #08-12

SUBJECT:

Motion Picture Production Company Exemption
(Sales & Use Tax)

EFFECTIVE DATE:

July 1, 2008

SUPERSEDES:

SC Revenue Ruling #05-7 and all previous advisory opinions and any
oral directives in conflict herewith.

REFERENCES:

S. C. Code Ann. Section 12-62-20 (Senate Bill 1171 of 2008)
S. C. Code Ann. Section 12-62-30 (Senate Bill 1171 of 2008)
S. C. Code Ann. Section 12-62-40 (Senate Bill 1171 of 2008)
S. C. Code Ann. Section 12-36-2120(43) (2000)

AUTHORITY:

S. C. Code Ann. Section 12-4-320 (2000)
S. C. Code Ann. Section 1-23-10(4) (Supp. 2007)
SC Revenue Procedure #05-2

SCOPE:

The purpose of a Revenue Ruling is to provide guidance to the public
and to Department personnel. It is an advisory opinion issued to apply
principles of tax law to a set of facts or general category of taxpayers. It
is the Department’s position until superseded or modified by a change in
statute, regulation, court decision, or another Departmental advisory
opinion.

Introduction
The South Carolina Motion Picture Incentive Act (S.C. Code Ann. Section 12-62-10 et seq., as
amended by Senate Bill 1171 of 2008) provides tax incentives for motion picture production
companies spending monies in South Carolina. One of these incentives is a sales and use tax
exemption in Code Section 12-62-30.
Code Section 12-36-2120(43) also contains a less expansive sales and use tax exemption that is
available to motion picture companies for use in filming or producing motion pictures.
The purpose of this document is to provide the Department’s opinions with respect to some of
the common questions that have arisen concerning these sales and use tax incentives and to
update a previously issued advisory opinion (SC Revenue Ruling #05-7) due to the transfer of
the South Carolina Film Commission from the SC Department of Commerce to the SC
Department of Parks, Recreation and Tourism (effective July 1, 2008).

1

Law:
The sales and use tax provisions of the South Carolina Motion Picture Incentive Act are found in
Chapter 62 of Title 12 and are quoted below.
Code Section 12-62-30 states:
A motion picture production company that intends to expend in the aggregate two
hundred fifty thousand dollars or more in connection with the filming or
production of one or more motion pictures in the State of South Carolina within a
consecutive twelve-month period, upon making application for, meeting the
requirements of, and receiving written certification of that designation from the
department as provided in this chapter, shall be relieved from the payment of state
and local sales and use taxes administered and collected by the Department of
Revenue on funds expended in South Carolina in connection with the filming or
production of a motion picture or pictures. The production of television coverage
of news and athletic events is specifically excluded from the provisions of this
chapter.
Code Section 12-62-40 states:
(A) A motion picture production company that intends to film all or parts of a
motion picture in South Carolina and desires to be relieved from the payment of
the state and local sales and use taxes, administered and collected by the
Department of Revenue, as provided in this chapter shall provide an estimate of
total expenditures expected to be made in South Carolina in connection with the
filming or production of the motion picture. The estimate of expenditures must be
filed with the department before the commencement of filming in South Carolina.
(B) At the time the motion picture production company provides the estimate of
expenditures to the department, it also shall designate a member or representative
of the motion picture production company to work with the department and the
Department of Revenue on reporting of expenditures and other information
necessary to take advantage of the tax relief afforded by this chapter.
(C)(1) An application for the tax relief provided by this chapter must be
accepted only from those motion picture production companies that report
anticipated expenditures in the State in the aggregate equal to or exceeding two
hundred fifty thousand dollars in connection with the filming or production of one
or more motion pictures in the State within a consecutive twelve-month period.
(2)

The application must be approved by the director.

(3) Once the application is approved by the director, the Department of Revenue
shall issue a sales and use tax exemption certificate to the motion picture
production company as evidence of the exemption. The exemption is effective on
the date the application is approved by the director.

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(D) A motion picture production company that is approved and receives a sales
and use tax exemption certificate but fails to expend two hundred fifty thousand
dollars within a consecutive twelve-month period is liable for the sales and use
taxes that would have been paid had the approval not been granted; except, that
the motion picture production company must be given a sixty-day period in which
to pay the sales and use taxes without incurring penalties. The sales and use taxes
are considered due as of the date the tangible personal property was purchased in
or brought into South Carolina for use, storage, or consumption.
(E) Upon completion of the motion picture, the motion picture production
company must return the sales and use tax exemption certificate to the
Department of Revenue and submit a report to the department of the actual
expenditures made in South Carolina in connection with the filming or production
of the motion picture.
Code Section 12-62-20 provides definitions for various terms used in the above statutes and
states:
For purposes of this chapter:
(1) 'Company' means a corporation, partnership, limited liability company, or
other business entity.
(2)

'Department' means the Department of Parks, Recreation and Tourism.

(3) 'Motion picture' means a feature-length film, video, television series, or
commercial made in whole or in part in South Carolina, and intended for national
theatrical or television viewing or as a television pilot produced by a motion
picture production company. The term 'motion picture' does not include the
production of television coverage of news and athletic events or a production
produced by a motion picture production company if records, as required by 18
U.S.C. 2257, are to be maintained by that motion picture production company
with respect to any performer portrayed in that single media or multimedia
program.
(4) 'Motion picture production company' means a company engaged in the
business of producing motion pictures intended for a national theatrical release or
for television viewing. 'Motion picture production company' does not mean or
include a company owned, affiliated, or controlled, in whole or in part, by a
company or person that is in default on a loan made by the State or a loan
guaranteed by the State.

(6) 'Director' means the director of the Department of Parks, Recreation and
Tourism, or his designee.

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If a motion picture production company does not meet the requirements of the exemption in
Code Section 12-62-30, it may still be eligible for the sales and use tax exemption in Code
Section 12-36-2120(43). Code Section 12-36-2120(43) exempts from the tax:
all supplies, technical equipment, machinery, and electricity sold to motion picture
companies for use in filming or producing motion pictures. For the purposes of this item,
“motion picture” means any audiovisual work with a series of related images either on
film, tape, or other embodiment, where the images shown in succession impart an
impression of motion together with accompanying sound, if any, which is produced,
adapted, or altered for exploitation as entertainment, advertising, promotional, industrial,
or educational media; and a “motion picture company” means a company generally
engaged in the business of filming or producing motion pictures.
It is also important to note two other aspects of the sales and use tax law:

1. The South Carolina sales and use tax applies to rentals, leases and licenses to use as
   well as sales and purchases. See the definition of the term “sale” in Code Section 1236-100.
2. The South Carolina sales and use tax law defines “tangible personal property” in
   Code Section 12-36-60 to mean personal property that may be seen, weighed,
   measured, felt, touched, or is in any manner perceptible to the senses. Also included
   in this definition are certain services and intangibles subject to the tax under Code
   Sections 12-36-910(B), 12-36-920, 12-36-1310(B), and 12-36-2645. The services and
   intangibles included in the definition of “tangible personal property” and subject to
   the tax under these sections include:
   Communication services, such as
   Answering services
   Cable and satellite programming televisions services
   Database access transmission services (On-line information services)
   E-mail services
   Fax transmission services
   Paging services
   Prepaid wireless calling arrangements
   Teleconferencing services
   Telephone services, including cell phone service
   Additional guest charges at places furnishing sleeping accommodations, such as
   Amenities
   Entertainment
   In-room movies
   Laundering and dry cleaning services
   Rental of meeting rooms

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Room Service
Special items in promotional tourist packages
Telephone charges
Other Guest Services
Electricity
Laundering, dry cleaning, dyeing or pressing services
Sleeping/lodging accommodations/services (7% state rate)
900/976 telephone services (10% state rate)
Warranty, maintenance and similar service contracts for tangible personal property
Questions and Answers - Sales and Use Tax Exemption
Since the sales and use tax applies to sales, purchases, rentals, leases, licenses to use and
other agreements in which title or possession of tangible personal property is transferred
for a consideration, the use of the terms “sale” or “purchase” in this document includes
rentals, leases, licenses to use, and other such agreements.

1. Q. What is the sales and use tax incentive available to a motion picture production company
   under Code Section 12-62-30?
   A. Code Section 12-62-30 exempts sales to, or purchases by, a qualifying motion picture
   production company from sales and use taxes on purchases expended in South Carolina
   in connection with the filming or production of motion pictures in South Carolina. See
   Questions #2, #12, and #13 for more information.
2. Q. Does the exemption apply to both state sales and use taxes and local sales and use taxes?
   A. This exemption applies to the following taxes:
3. The state sales and use tax (i.e., 6% 1 sales and use taxes imposed under Code
   Sections 12-36-910, 12-36-1310, 12-36-1320 and 12-36-1110; 7% sales tax on
   accommodations imposed under Code Section 12-36-920; 5% rental surcharge
   imposed under Code Section 56-31-50; and 11% sales and use tax on 900/976
   telephone numbers imposed under Code Sections 12-36-2645 and 12-36-1110, and
4. Any local sales and use tax (e.g., local option tax, capital projects tax, transportation
   tax, various school district taxes, etc.) that is administered and collected by the
   Department of Revenue on behalf of a local jurisdiction.
   1

On July 1, 2007, the state sales and use tax rate was increased from 5% to 6% with the enactment of a 1% increase
under Code Section 12-36-1110. However, this increase did not apply to sales of items subject to a maximum tax
under Code Section 12-36-2110 (e.g., motor vehicles, boats, aircraft, and recreational vehicles). Sales of items
subject to the maximum tax are subject to a 5% state sales and use tax rate, up to a maximum of $300 for each sale
of each item. Sales to, or purchases by, a qualifying motion picture production company of such items are exempt
from the 5% state sales and use taxes under Code Section 12-62-30 when purchased in connection with the filming
or production of motion pictures in South Carolina. Sales of items subject to a maximum tax are not subject to local
sales and use taxes administered and collected by the Department of Revenue.

5

Taxes this exemption does not apply to include:

1. any local sales tax administered and collected directly by a local government
   jurisdiction (i.e, local hospitality tax and local accommodations tax),
2. the 1% drycleaning surcharge imposed under Code Section 44-56-430 since it is not a
   sales tax, and
3. the solid waste excise taxes imposed on motor oils under Code Section 44-96160(W), tires under Code Section 44-96-170(N), lead-acid batteries under Code
   Section 44-96-180(F), and white goods (refrigerators, ranges, etc.) under Code
   Section 44-96-200(E). For purposes of this tax, the definitions for motor oil, tires,
   lead-acid batteries and white goods can be found in Code Section 44-96-40.
   Note: The Department of Revenue publishes a chart with the various types of local sales
   and use taxes collected by the Department of Revenue and the exemptions allowed under
   each tax. As of the date of this document, SC Information Letter #07-4 contains the most
   recently published information; updated information will be published on the Department
   of Revenue’s website http://www.sctax.org/Tax+Policy/Policy/salesdx.htm as warranted.
4. Q. What requirements must be met to qualify as a motion picture production company
   eligible for the sales and use tax exemption in Code Section 12-62-30?
   A. A motion picture production company as defined in Code Section 12-62-20(4) (See
   Question #4) qualifies for the exemption in Code Section 12-62-30 if the company:
5. Intends to spend $250,000 or more in South Carolina in connection with the filming
   or production of all or part of one or more motion pictures as defined in Code Section
   12-62-20(3) (See Question #5) in South Carolina within a consecutive 12 month
   period;
6. Submits an application to the South Carolina Department of Parks, Recreation and
   Tourism;
7. Files an estimate of expenditures with the South Carolina Department of Parks,
   Recreation and Tourism before the commencement of filming in South Carolina;
8. Designates (at the same time the estimate of expenditures is filed) a member or
   representative to work with the South Carolina Department of Parks, Recreation and
   Tourism and the Department of Revenue on reporting of expenditures and other
   information necessary to take advantage of the exemption;
9. Receives written certification as a qualifying company from the South Carolina
   Department of Parks, Recreation and Tourism. Code Section 12-62-30; and,

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6. Upon approval of the Director of the South Carolina Department of Parks, Recreation
and Tourism, receives a sales and use tax exemption certificate (Form ST-433) from
the South Carolina Department of Revenue. See Question #10. The exemption is
effective on the date the application is approved by the Director of the South Carolina
Department of Parks, Recreation and Tourism. Code Section 12-62-40(C)(3).
Note: Upon completion of the motion picture, the motion picture production company
must return the sales and use tax exemption certificate to the Department of Revenue and
must submit a report to the South Carolina Department of Parks, Recreation and Tourism
of the actual expenditures made in South Carolina in connection with the filming or
production of the motion picture. Code Section 12-62-40(E).

4. Q. What is a “motion picture production company”?
   A. A “motion picture production company” is “a company engaged in the business of
   producing motion pictures intended for a national theatrical release or for television
   viewing. 'Motion picture production company' does not mean or include a company
   owned, affiliated, or controlled, in whole or in part, by a company or person that is in
   default on a loan made by the State or a loan guaranteed by the State.” Code Section 1262-20(4).
5. Q. What is a “motion picture”?
   A. A “motion picture” is a feature-length film, video, television series, or commercial made
   in whole or in part in South Carolina, and intended for national theatrical or television
   viewing or as a television pilot produced by a motion picture production company. The
   term 'motion picture' does not include the production of television coverage of news and
   athletic events or a production produced by a motion picture production company if
   records, as required by 18 U.S.C. 2257, are to be maintained by that motion picture
   production company with respect to any performer portrayed in that single media or
   multimedia program. Code Section 12-62-20(3).
6. Q. What information must the company provide to the South Carolina Department of Parks,
   Recreation and Tourism to request approval for the exemption?
   A. As of the date of this document, the South Carolina Department of Parks, Recreation and
   Tourism has informed the Department of Revenue that the following information must be
   provided to the South Carolina Department of Parks, Recreation and Tourism to obtain
   approval for this exemption:
7. Submit a “South Carolina Motion Picture Incentives Application” for approval by the
   Director of the South Carolina Department of Parks, Recreation and Tourism. Code
   Section 12-62-40(C).

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2. Provide an estimate of total expenditures expected to be made in South Carolina in
connection with the filming or production of the motion picture with the South
Carolina Department of Parks, Recreation and Tourism before beginning filming in
South Carolina. Code Section 12-62-40(A).

3. Designate a member or representative to work with the South Carolina Department of
   Parks, Recreation and Tourism and South Carolina Department of Revenue on
   reporting of expenditures and other necessary information. Code Section 12-6240(B).
4. Other information required by the South Carolina Department of Parks, Recreation
   and Tourism.
5. Q. How do I contact the South Carolina Department of Parks, Recreation and Tourism for
   additional information or an application form?
   A. Contact the SC Film Commission, which is a part of the South Carolina Department of
   Parks, Recreation and Tourism, by phoning 803-737-0490. Their mailing address is:
   SC Film Commission
   1205 Pendleton Street, Room 529
   Columbia, SC 29201
6. Q. What expenditures meet the $250,000 requirement?
   A. Expenditures that qualify toward the $250,000 requirement include:
7. Purchases of services or intangibles in South Carolina
8. Purchases or rentals of tangible personal property in South Carolina
9. Purchases or rentals of real property located in South Carolina.
10. Q. What if the minimum expenditure requirement is not met?
    A. If a company does not spend the required $250,000 in the 12 month period, then it is
    liable for sales and use taxes that would have been paid had the approval not been granted
    by the Director of the South Carolina Department of Parks, Recreation and Tourism. The
    company is given a 60 day period to pay the taxes without incurring penalties. However,
    the motion picture production company would be liable for interest due on such taxes as
    imposed under Code Section 12-54-25. The sales and use taxes are considered due as of
    the date the tangible personal property was purchased in or brought into South Carolina
    for use, storage, or consumption. Code Section 12-62-40(D).
    10.

Q. How are purchases made tax free using the exemption certificate by a qualified motion
picture production company?

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A. Upon approval of the Director of the South Carolina Department of Parks, Recreation and
Tourism, the Department of Revenue will issue the motion picture production company a
Form ST-433, the sales and use tax exemption certificate. The exemption is effective on
the date the application is approved by the Director of the South Carolina Department of
Parks, Recreation and Tourism. Code Section 12-62-40(C)(3).
A copy of Form ST-433 is given to the retailer by the motion picture production company
at the time of purchase.
The retailer may maintain a copy of the certificate on file; therefore, it is not necessary to
provide a copy each time a purchase is made from the same retailer. By maintaining a
copy on file, the retailer is able to verify with each sale that the sale is being made to a
motion picture production company that meets the requirements of the exemption.
Note: The exemption certificate (Form ST-433) issued to a motion picture production
company will have an expiration date. Sales to, or purchases by, a motion picture
production company after this date are not exempt. However, if filming and production is
expected to extend beyond the original expiration date, a revised exemption certificate
with a new expiration date can be issued by contacting the Department of Revenue’s
License and Registration Section at (803) 896-1350.
11.

Q. Who can use the exemption certificate?
The exemption certificate may only be used by the motion picture production company in
whose name the exemption certificate has been issued since the exemption only applies
to sales to, or purchases by, the motion picture production company.
Examples of persons who are not authorized to use the exemption certificate include:

1. Cast and crew purchasing items for their personal use.
2. Subcontractors or others providing services to the motion picture production
   company.

12.

Q. What purchases may be made tax free using Form ST-433?
A. The purchase of tangible personal property, or any service that is subject to the sales and
use tax, is exempt from all state and local sales and use tax that are administered and
collected by the Department of Revenue if purchased by a motion picture production
company meeting the requirements of the incentive and used in connection with the
filming or production of a motion picture in South Carolina. The exemption applies to
such purchases made in South Carolina and purchases made in another state for first use
in South Carolina. For examples of exempt purchases, see Question #13.

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13.

Q. What are examples of purchases that qualify for the exemption under Code Section 1262-30?
A. The following provides examples of exempt purchases, provided such purchases are used
in connection with the filming or production of a motion picture, purchased by the motion
picture production company, and all other requirements of the statute are met.
Examples of exempt tangible personal property 2 include:
Aircraft
Animals
Automobiles and other vehicles 3
Cameras and camera parts
Catering
Cleaning supplies
Cleanup equipment
Computer equipment
Construction and hardware materials
Copies
Copy machines
Filming supplies (e.g., film stock, flats (panels of scenery), sandbags, etc.)
Food
Gasoline and other fuels (however, motor fuel taxes may apply) 4
Generators/grip and lighting equipment
Hairstyle supplies
Hand tools
Make-up
Office supplies and equipment
Portable dressing rooms and offices
Portable toilets
Production supplies (e.g., editing supplies)
Props (e.g., vehicles, furniture, books, paintings, clothing, shrubbery)

2

As stated in question #11, the exemption only applies to purchases by the motion picture production company. For
example, the purchase of hairstyling supplies by a motion picture production company are exempt, but the purchase
of such supplies by an independently owned hairstyling service company that has been hired by a motion picture
production company to provide hairstyling services are subject to the tax. See footnote #4.
3
The rental for periods of thirty-one days or less of private passenger vehicles, trucks under 26,001 pounds gross
vehicle weight (for non-business purposes), and trailers with a gross weight of not more than 6,000 pounds are
subject to state and local sales and use taxes and a 5% rental surcharge. By statute, the 5% rental surcharge is a sales
tax. Therefore, motion picture production companies meeting the requirements of the incentive in Code Sections 1262-30 and 12-62-40 are also exempt from the 5% rental surcharge.
4
As a general rule, gasoline and undyed diesel fuel are subject to the $0.16 a gallon motor fuel tax and are exempt
from sales and use taxes and dyed diesel fuel and dyed kerosene are subject to sales and use taxes (unless otherwise
exempt under the law) and exempt from the $0.16 a gallon motor fuel tax. As such, the exemption certificate (Form
ST-433) issued to the motion picture production company does not need to be presented upon the purchase of
gasoline and undyed diesel fuel, but should be presented to the retailer to purchase dyed diesel fuel and dyed
kerosene exempt from the sales and use tax. The statute does not provide an exemption for the motor fuel tax for
motion picture production companies.

10

Technical equipment and machinery (e.g., boom, cables, cranes, dolly, editing
equipment, grip truck, matte, tape¸ teleprompter)
Telephones
Vehicles (e.g., props, dressing room vehicles, camera cars, equipment vehicles)
Walkie talkies
Wardrobe
Examples of exempt services and charges 5 include:
Communication services, such as
Answering services
Cable and satellite programming televisions services
Database access transmission services (On-line information services)
E-mail services
Fax transmission services
Paging services
Prepaid wireless calling arrangements
Teleconferencing services
Telephone services, including cell phone service
Additional guest charges at places furnishing sleeping accommodations, such as
Amenities
Entertainment
In-room movies
Laundering and dry cleaning services
Rental of meeting rooms
Room Service
Special items in promotional tourist packages
Telephone charges
Other Guest Services
Electricity
Laundering, dry cleaning, dyeing or pressing services 6
Sleeping/lodging accommodations/services
900/976 telephone services
Warranty, maintenance and similar service contracts for tangible personal property
5

The services and charges listed in this category are normally subject to the tax under Code Sections 12-36-910(B),
12-36-920, 12-36-1310(B), 12-36-1110 and 12-36-2645, but are exempt when purchased by a motion picture
production company meeting the requirements of the South Carolina Motion Picture Incentive Act for use in
connection with the filming or production of a motion picture.
6
Certain drycleaning facilities are participating in the Drycleaning Facility Restoration Trust Fund and are subject to
a 1% drycleaning surcharge. While this surcharge is administered and collected in the same manner as the state sales
and use tax, it is not a sales tax. As such, drycleaning services purchased by a motion picture production company
are not exempt from the 1% drycleaning surcharge.

11

Note: For more detailed information concerning the taxation of additional guest charges
at places furnishing sleeping accommodations, see SC Regulation 117-307.1. For more
detailed information concerning the taxation of certain communication services, see SC
Regulation 117-329 and SC Revenue Ruling #06-8.

14.

Q. What are examples of other purchases that South Carolina does not tax under its sales and
use tax laws?
The following are examples of professional and other personal services, intangibles, and
real property transactions upon which the South Carolina sales and use tax is not
imposed.
Examples of nontaxable services, nontaxable intangibles, and nontaxable real property
transactions 7 , include:
Services
Accounting services
Airline and aircraft charter services
Casting services
Chauffeured limousine services
Clerical services
Construction services
Filming and production services provided by the director, the actors, the crew,
writers, editors, choreographers, stunt persons, dialog coaches, musicians, technical
advisors, designers, hairstylists, makeup artists, wardrobe persons, and similar
persons providing services
Garbage disposal services
Hairstyling/cosmetic services
Janitorial services
Legal services
Meteorological services
Musical services
Payroll services
Research services
Scouting services
Security services

7

These are examples of professional and other personal services, intangibles, and real property transactions upon
which the South Carolina sales and use tax is not imposed. Since the film industry operates in many states and must
deal with varying sales and use tax laws, this list merely provides examples of services, intangibles, and real
property transactions the charges for which are not taxable in South Carolina. However, it is important to note that
purchases by persons providing these services to a motion picture production company or any other person are
subject to the tax. For example, charges by a janitorial service company to a motion picture production company or
any other person are not subject to the tax; however, the sale to, or purchase by, the janitorial service company of the
supplies (mops, floor cleaners, trash bags, etc.) it uses in providing its service are subject to the sales and use tax.

12

Taxi services
Typing services
Intangibles
Music royalties
Story rights payments

Real Property Transactions
Auditorium rentals
Back lot rentals
Casting facility rentals
Dressing room rentals
Location rentals or fees
Office space rentals
Parking lot rentals
Screening room rentals
Stage rentals
Warehouse rentals

15. Q. If a motion picture company does not meet the requirements of the exemption in Code
    Section 12-62-30, could it be eligible for another sales and use tax exemption in Code
    Section 12-36-2120(43)?
    A. Yes. Code Section 12-36-2120(43) provides a sales and use tax exemption for supplies,
    technical equipment, machinery, and electricity sold to a motion picture company (i.e., a
    company generally engaged in the business of filming or producing motion pictures) for
    use in filming or producing a motion picture.
    This exemption only applies to supplies, technical equipment, machinery, and electricity
    purchased by a motion picture company and used and consumed directly and
    predominantly in filming or producing a motion picture. It does not apply to purchases of
    property for administrative purposes, such as sales promotions, general office work,
    ordering and receiving materials, making travel arrangements, the preparation of shooting
    schedules, and preparation of work and payroll records. It does not apply to purchases by
    the cast and crew of items for their own personal use or to purchases by subcontractors or
    others providing services to the motion picture company.
    This exemption applies to the 6% state sales and use tax and to all local sales and use
    taxes administered and collected by the Department of Revenue on behalf of a local
    jurisdiction. It does not apply to the sales taxes imposed upon communication services,
    additional guest charges at places furnishing accommodations, laundering, drycleaning,
    dyeing and pressing services, sleeping/lodging accommodations services, and 900/976
    telephone services since such services do not constitute supplies. It does not apply to the
    5% rental surcharge on the rental of certain vehicles since the rental surcharge is not a
    sales tax that is imposed under Chapter 36 of Title 12.

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16. Q. How does a motion picture company make purchases under the exemption in Code
Section 12-36-2120(43)?
A. The statute does not require a motion picture company to obtain an exemption certificate
in order to take advantage of the exemption for supplies, technical equipment, machinery,
and electricity in the exemption in Code Section 12-36-2120(43). However, the
Department of Revenue recommends that motion picture companies apply for the
exemption certificate. If a motion picture company is issued a certificate, this will
simplify for the motion picture company the purchase from suppliers of items exempt
under Code Section 12-36-2120(43). Otherwise, suppliers may be reluctant to sell items
tax-free (exempt) to a motion picture company that does not have an exemption
certificate.
In order to obtain an exemption certificate for the exemption in Code Section 12-362120(43), the motion picture company files a Form ST-10 (Application for Certificate)
with the Department of Revenue. If approved by the Department of Revenue, the motion
picture company will be issued a Form ST-9, the sales and use tax exemption certificate.
This exemption does not require the filing of an application with, or the approval of, the
South Carolina Department of Parks, Recreation and Tourism.
A copy of Form ST-9 is given to the retailer by the motion picture company at the time of
purchase. The retailer may maintain a copy of the certificate on file; therefore, it is not
necessary to provide a copy each time a purchase is made from the same retailer. By
maintaining a copy on file, the retailer is able to verify with each sale that the sale is
being made to a motion picture company that meets the requirements of the exemption in
Code Section 12-36-2120(43). (See discussion of this exemption in Question #15.)
Note: If a motion picture company uses an ST-9 to purchase items that are not supplies,
technical equipment, machinery, and electricity used and consumed directly and
predominantly in filming or producing a motion picture, then the motion picture company
is liable for the tax due on such purchases as well as any applicable penalties and interest.
SOUTH CAROLINA DEPARTMENT OF REVENUE

s/Ray N. Stevens
Ray N. Stevens, Director
August 2
, 2008
Columbia, South Carolina

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