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(1) tangible personal property or receipts of any business which the State is prohibited from taxing by the Constitution or laws of the United States of America or by the Constitution or laws of this State;

(2) tangible personal property sold to the federal government;

(3) textbooks, magazines, and periodicals used as a part of a course of study in primary and secondary schools and institutions of higher learning, and all books, magazines, and periodicals sold to publicly supported state, county, or regional libraries which are open to the public without charge;

(4)(3) livestock. `Livestock' is defined as domesticated animals customarily raised on South Carolina farms for use primarily as beasts of burden, or food, and certain mammals when raised for their pelts or fur. Animals such as dogs, cats, reptiles, fowls (except baby chicks and poults), and animals of a wild nature, are not considered livestock;

(5)(4) feed used for the production and maintenance of poultry and livestock;

(6)(5) insecticides, chemicals, fertilizers, soil conditioners, seeds, or seedlings, or nursery stock, used solely in the production for sale of farm, dairy, grove, vineyard, or garden products or in the cultivation of poultry or livestock feed;

(7)(6) containers and labels used in:

(a) preparing agricultural, dairy, grove, or garden products for sale; or

(b) preparing turpentine gum, gum spirits of turpentine, and gum resin for sale.

For purposes of this exemption, containers mean boxes, crates, bags, bagging, ties, barrels, and other containers;
(8) newsprint paper, newspapers, and religious publications, including the Holy Bible and the South Carolina Department of Agricultures The Market Bulletin;

(9) coal, or coke or other fuel sold to manufacturers, electric power companies, and transportation companies for:

(a) use or consumption in the production of by-products;

(b) the generation of heat or power used in manufacturing tangible personal property for sale. For purposes of this item, `manufacturer' or `manufacturing' includes the activities of a processor;

(c) the generation of electric power or energy for use in manufacturing tangible personal property for sale; or

(10)(7) (a) meals or foodstuffs used in furnishing meals to school children, if the sales or use are within school buildings and are not for profit;

(b) meals or foodstuffs provided to elderly or disabled persons at home by nonprofit organizations that receive only charitable contributions in addition to sale proceeds from the meals;
(11) (a) toll charges for the transmission of voice or messages between telephone exchanges;

(b) charges for telegraph messages; and

(c) carrier access charges and customer access line charges established by the Federal Communications Commission or the South Carolina Public Service Commission;

(12) water sold by public utilities, if rates and charges are of the kind determined by the Public Service Commission, or water sold by nonprofit corporations organized pursuant to Sections 33-35-10 to 33-35-170;

(13) fuel, lubricants, and supplies for use or consumption aboard ships in intercoastal trade or foreign commerce. This exemption does not exempt or exclude from the tax the sale of materials and supplies used in fulfilling a contract for the painting, repair, or reconditioning of ships and other watercraft;

(14) wrapping paper, wrapping twine, paper bags, and containers, used incident to the sale and delivery of tangible personal property;

(15)(8) gasoline or other motor vehicle fuels taxed at the same rate as gasoline, fuels used in farm machinery, farm tractors, and commercial fishing vessels, and clean alternative transportation fuels as defined in regulation by the South Carolina Department of Revenue and Taxation as defined by the State Energy Office. Gasoline used in aircraft is not exempted by this item;

(16)(9) farm machinery and their replacement parts and attachments, used in planting, cultivating or harvesting farm crops, including bulk coolers (farm dairy tanks) used in the production and preservation of milk on dairy farms, and machines used in the production of poultry and poultry products on poultry farms, when such products are sold in the original state of production or preparation for sale. This exemption does not include automobiles or trucks;

(17) machines used in manufacturing, processing, compounding, mining, or quarrying tangible personal property for sale. `Machines' include the parts of machines, attachments, and replacements used, or

(18)(10) fuel used exclusively to cure agricultural products;

(19) electricity used by manufacturers, miners, or quarriers to manufacture, mine, or quarry tangible personal property for sale. For purposes of this item, `manufacturer' or `manufacture' includes the activities of processors;

(20) railroad cars, locomotives, and their parts, monorail cars, and the engines or motors that propel them, and their parts;

(21) vessels and barges of more than fifty tons burden;

(22) materials necessary to assemble missiles to be used by the Armed Forces of the United States;

(23)(11) farm, grove, vineyard, and garden products, if sold in the original state of production or preparation for sale, when sold by the producer or by members of the producer's immediate family;

(24) supplies and machinery used by laundries, cleaning, dyeing, or pressing establishments in the direct performance of their primary function, but not sales of supplies and machinery used by coin-operated laundromats;

(25) motor vehicles (excluding trucks) or motorcycles, which are required to be licensed to be used on the highways, sold to a resident of another state, but who is located in South Carolina by reason of orders of the United States Armed Forces. This exemption is allowed only if, within ten days of the sale, the vendor is furnished a statement, from a commissioned officer of the Armed Forces of a higher rank than the purchaser, certifying that the buyer is a member of the Armed Forces on active duty, and a resident of another state;

(26) all supplies, technical equipment, machinery, and electricity sold to radio and television stations, and cable television systems, for use in producing, broadcasting, or distributing programs. For the purpose of this exemption, radio stations, television stations, and cable television systems are deemed to be manufacturers;

(27) all plants and animals sold to any publicly supported zoological park or garden or to any of its nonprofit support corporations;

(28)(12) medicine and prosthetic devices sold by prescription; hypodermic needles, insulin, alcohol swabs, and blood sugar testing strips sold to diabetics under the authorization and direction of a physician; and dental prosthetic devices;

(29)(13) Reserved; food which may be purchased lawfully with United States Department of Agriculture food stamps;

(31) vacation time sharing lease plans as provided by Chapter 32 of Title 27;

(32)(14) natural and liquefied petroleum gas and electricity used exclusively in the production of poultry, livestock, swine, and milk;

(33) electricity, natural gas, fuel oil, kerosene, LP gas, coal, or any other combustible heating material or substance used for residential purposes. Individual sales of kerosene of twenty gallons or less by retailers are considered used for residential heating purposes;

(34) thirty-five percent of the gross proceeds of the sale of modular homes as defined in Section 31-17-20;

(35) motion picture film sold or rented to or by theaters;

(36) tangible personal property where the seller, by contract of sale, is obligated to deliver to the buyer, or to an agent or donee of the buyer, at a point outside this State or to deliver it to a carrier or to the mails for transportation to the buyer, or to an agent or donee of the buyer, at a point outside this State;

(37) petroleum asphalt products, commonly used in paving, purchased in this State, which are transported and consumed out of this State;

(38) hearing aids, as defined by Section 40-25-20(5);

(39) concession sales at a festival by an organization devoted exclusively to public or charitable purposes, if:

(a) all the net proceeds are used for those purposes;

(b) the festival is listed as a special event in the calendar of events provided by the South Carolina Department of Parks, Recreation and Tourism; and

(c) in advance of the festival, its organizers provide the commission, on a form it prescribes, information necessary to insure compliance with this item. For purposes of this item, a `festival' does not include a recognized state or county fair;

(40) containers and chassis, including all parts, components, and attachments, sold to international shipping lines which have a contractual relationship with the South Carolina State Ports Authority and which are used in the import or export of goods to and from this State. The exemption allowed by this item is effective for sales after June 30, 1982;

(41) items sold by organizations exempt under Section 12-37-220 A(3) and (4) and B(5), (6), (7), (8), (12), (16), (19), (22), and (24), if the net proceeds are used exclusively for exempt purposes and no benefit inures

(43) 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;

(44)(15) electricity used to irrigate crops;

(45)(16) gross proceeds from the sale of building materials, supplies, fixtures, and equipment for the construction, repair, or improvement of or that become a part of a self-contained enclosure or structure specifically designed, constructed, and used for the commercial housing of poultry or livestock.

(46) War memorials or monuments honoring units or contingents of the Armed Forces of the United States or of the National Guard, including United States military vessels, which memorials or monuments are affixed to public property;

(47) tangible personal property sold to charitable hospitals predominantly serving children exempt under Section 12-37-220, where care is provided without charge to the patient."

SECTION . The unnumbered sections adding Article 10, Chapter 36 of Title 12, and amending Sections 12-36-2110 and 12-36-2120 take effect July 1, 1995.

SECTION . The additional revenue generated each fiscal year beginning on July 1, 1995, as determined by the State Treasurer from the amendments to Sections 12-36-2110 and 12-36-2120 of the 1976 Code as contained in this act must be transferred from the state general fund to the

Renumber sections to conform.

Amend totals and title to conform.

Rep. STURKIE explained the amendment.

Rep. WAITES raised the Point of Order that Amendment No. 2 was out of order as it was not germane.

Rep. STURKIE argued contra the Point in stating that it definitely affected sales tax exemptions and was related to sales tax. He further stated that the heading of the Bill related to sales tax and the amendment also reflected that.

The SPEAKER stated that the House had adopted Amendment No. 1 at this point which provided for an additional exemption from sales taxes.

Rep. McTEER stated that there was precedence from last week when the Chair ruled that the amendment went so far beyond the intent of the Bill that it was ruled out of order even though some loose connection could be made of germaneness.

Rep. STURKIE stated that the amendment did go to some different degree of scope as far as the Bill was concerned, but that it definitely did relate to the Bill and within the Rules it would be germane.

The SPEAKER stated that it did relate to sales tax exemptions but the major part was to increase the sales tax and eliminate the property tax and the only way to effectively do that was to repeal some exemptions and that it was not germane and he sustained the Point of Order and ruled the amendment out of order.

Rep. FELDER proposed the following Amendment No. 3 (Doc Name L:\council\legis\amend\JIC\6005HTC.94).

Amend the bill, as and if amended, by adding two appropriately numbered SECTIONS to read:

/SECTION ___. A. Section 12-7-1250(A) of the 1976 Code, as added by Act 488 of 1988, is further amended to read:

"(A) A corporate taxpayer is allowed as a credit against taxes due pursuant to Section 12-7-230 an amount equal to fifty percent, not to exceed ten thousand dollars annually, of expenses paid or accrued by the taxpayer in building or improving any one infrastructure project. Any unused credit, up to a total amount of thirty thousand dollars, may be carried forward three years."

"(F) A corporation which files or is required to file a consolidated return is entitled to the income tax credit allowed by Section 12-7-1250(A) on a consolidated basis. The tax credit may be determined on a consolidated basis regardless of whether or not the corporation entitled to the credit contributed to the tax liability of the consolidated group.

(G) The merger, consolidation, or reorganization of a corporation where tax attributes survive does not create new eligibility in a succeeding corporation but unused credits may be transferred and continued by the succeeding corporation. In addition, a corporation may assign its rights to its unused credit to another corporation if it transfers all, or substantially all, of the assets of the corporation or all, or substantially all, of the assets of a trade or business or operating division of a corporation to another corporation."

C. This section is effective for taxable years beginning after 1987.

SECTION ___. A. Section 41-44-30 of the 1976 Code, as added by Act 643 of 1988, is amended by adding at the end:

"A corporation which files or is required to file a consolidated return is entitled to the income tax credit allowed by this section on a consolidated basis. The tax credit may be determined on a consolidated basis regardless of whether or not the corporation entitled to the credit contributed to the tax liability of the consolidated group.

The merger, consolidation, or reorganization of a corporation where tax attributes survive does not create new eligibility in a succeeding corporation but unused credits may be transferred and continued by the succeeding corporation. In addition, a corporation may assign its rights to its unused credit to another corporation if it transfers all, or substantially all, of the assets of the corporation or all, or substantially all, of the assets of a trade or business or operating division of a corporation to another corporation."

B. This section is effective for taxable years beginning after 1987./

Renumber sections to conform.

Amend title to conform.

Rep. FELDER explained the amendment and moved to adjourn debate upon the Bill until Wednesday, May 11, which was adopted.

Rep. A. YOUNG moved to adjourn debate upon the following Bill until Tuesday, May 17, which was adopted.

S. 712 -- Senator Hayes: A BILL TO AMEND SECTION 43-45-30, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE COMMUNITY ECONOMIC OPPORTUNITY ACT OF 1983, ADMINISTERING AGENCY, AND DUTIES AND FUNCTIONS, SO AS TO DELETE THE PROVISIONS RELATING TO THE DUTY OF PRESCRIBING THE PERSONNEL PROCEDURES AND FINANCIAL SYSTEMS UNDER WHICH EACH COMMUNITY-BASED ORGANIZATION RECEIVING FUNDS UNDER CHAPTER 45 OF TITLE 43 MUST OPERATE AND RELATING TO THE DUTY OF REVIEWING AND APPROVING ALL BYLAWS FOR ORGANIZATIONS RECEIVING FUNDS UNDER THAT CHAPTER.

The following Bill was taken up.

S. 73 -- Senator Rose: A BILL TO AMEND CHAPTER 11, TITLE 6, CODE OF LAWS OF SOUTH CAROLINA, 1976, BY ADDING ARTICLE 12 SO AS TO ALLOW THE QUALIFIED ELECTORS OF A COUNTY WITHOUT A RECREATION DISTRICT TO CREATE A RECREATION DISTRICT, TO AUTHORIZE THE MAXIMUM TAX MILLAGE FOR THE OPERATION OF THE DISTRICT, AND TO PROVIDE FOR THE CREATION OF A COMMISSION WITH CERTAIN POWERS AND DUTIES.

The Ways and Means Committee proposed the following Amendment No. 1 (Doc Name L:\council\legis\amend\JIC\5908HTC.94).

Amend the bill, as and if amended, by striking Section 4-20-40, as contained in SECTION 1, page 4, and inserting:

/Section 4-20-40. County council shall by ordinance provide for the operations of the community recreation special tax district which shall include the creation of a commission consisting of three to seven members elected by the qualified electors of the district. County council shall set the term of office for the members of the commission. All members elected to the commission must reside in the district, and no member of the commission shall receive compensation for service on the commission./

Amend title to conform.

Rep. CLYBORNE moved that the House recede until 2:30 P.M.

Rep. G. BROWN moved that the House do now adjourn.

Rep. HUFF demanded the yeas and nays, which were taken resulting as follows:

Those who voted in the affirmative are:

Alexander, T.C.  Askins           Bailey, J.
Brown, G.        Brown, J.        Carnell
Elliott          Farr             Harris, P.
Holt             Martin           McAbee
Phillips         Rogers           Snow
Tucker           Young, R.

Those who voted in the negative are:

Alexander, M.O.  Allison          Anderson
Bailey, G.       Baker            Beatty
Boan             Breeland         Brown, H.
Byrd             Cato             Chamblee
Clyborne         Cobb-Hunter      Cooper
Corning          Cromer           Davenport
Delleney         Fair             Fulmer
Gamble           Gonzales         Govan
Hallman          Harrell          Harrelson
Harris, J.       Harrison         Harwell
Haskins          Hines            Hodges
Houck            Huff             Hutson
Inabinett        Keegan           Kelley
Keyserling       Kirsh            Klauber
Koon             Lanford          Law
Littlejohn       Marchbanks       McMahand
McTeer           Meacham          Moody-Lawrence
Neal             Neilson          Quinn
Riser            Robinson         Rudnick
Scott            Sharpe           Sheheen

Shissias         Simrill          Smith, D.
Smith, R.        Spearman         Stille
Stone            Stuart           Sturkie
Trotter          Vaughn           Waites
Waldrop          Walker           Wells
Whipper          White            Wilder, J.
Wilkins          Williams         Witherspoon
Wofford          Wright           Young, A.

So, the House refused to adjourn.

Rep. RICHARDSON raised the Point of Order that 1:00 P.M. having arrived, the House should stand in recess until 2:15 P.M. in accordance with Rule 6.1.

The SPEAKER sustained the Point of Order.

Further proceedings were interrupted by the House receding, the pending question being consideration of Amendment No. 1, Rep. GONZALES having the floor.

At 2:15 P.M. the House resumed, the SPEAKER in the Chair.

The question of a quorum was raised.

The SPEAKER granted Reps. PHILLIPS, McTEER, P. HARRIS and G. BROWN a leave of absence for the remainder of the day.

The SPEAKER granted Rep. FELDER a leave of absence.

Rep. HOLT moved that the House do now adjourn.

Rep. HARRISON demanded the yeas and nays, which were taken resulting as follows:

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