THE STATE OF SOUTH CAROLINA 

In The Supreme Court 

Town of Hilton Head Island, Respondent, 

v. 

Kigre, Inc., Appellant. 

Appellate Case No. 2012-213239 

Appeal from Beaufort County 

The Honorable Marvin H. Dukes, III, Special Circuit 

Court Judge 

Opinion No. 27396 

Heard April 15, 2014 – Filed June 4, 2014 

AFFIRMED 

Thomas C. Taylor, of Hilton Head Island, for Appellant. 

Gregory M. Alford, of Hilton Head Island, for 

Respondent. 

PER CURIAM: This direct appeal involves a constitutional challenge to the 

Town of Hilton Head Island's ("Town") business license tax ordinance 

("Ordinance"), which requires businesses within the Town to pay an annual license 

fee based upon a business's classification and gross income. We affirm the trial 

court's finding that the Ordinance is valid. 

The legislature has specifically granted municipalities the authority to enact 

ordinances and "levy a business license tax on gross income." S.C. Code Ann. § 5-

7-30 (Supp. 2013) (emphasis added). We emphasize that the business license fee 
 

 

is an excise tax—not an income or a sales tax. A business license fee is a tax on 

the privilege of doing business within the Town, and therefore, it is the 

manufacturing activity of Appellant Kigre, Inc. ("Kigre"), which occurs wholly 

within the Town limits, and not Kigre's receipt of income or sales of its products in 

interstate commerce that is the business activity being taxed. Kigre has no other 

manufacturing facility and pays no license fee to any other taxing jurisdiction. See 

Carter v. Linder, 303 S.C. 119, 123, 399 S.E.2d 423, 425 (1990) (finding "[a] 

business license fee is an excise tax on the owner for the privilege of doing 

business"). 

The Ordinance requires "[e]very person engaged or intending to engage in any 

calling, business, occupation or profession . . . in whole or in part, within the limits 

of the town" to obtain a business license and pay a license fee, the amount of which 

is determined by the classification of the business and its gross income. See Hilton 

Head Island, S.C., Code of Ordinances § 10-1-10 (Sept. 26, 1983). The Ordinance 

defines gross income as: 

The total revenue of a business, received or accrued, for one fiscal 

year collected or to be collected by reason of the conduct of business 

within the town, excepting therefrom income from business done 

wholly outside of the town on which a license tax is paid to some 

other municipality or a county and fully reported to the town. Gross 

income from interstate commerce shall be included in the gross 

income for every business subject to a business license fee. 

Id. § 10-1-20(3) (Aug. 1, 2006). Further, section 10-1-60 provides a deduction 

from gross income for "business done wholly outside of the town on which a 

license tax is paid to some other municipality or a county." As previously noted, 

Kigre does not pay any license tax to any other municipality or county, either in 

South Carolina or anywhere in the world. 

Kigre has clothed its many arguments in the premise that the Ordinance is not 

sound policy, for it is anti-business. However, it is not within our province to 

weigh-in on the wisdom of legislative policy determinations. Our judicial role is 

limited to determining whether the Ordinance withstands Kigre's constitutional 

challenges. See Dunes West Golf Club, LLC v. Town of Mount Pleasant, 401 S.C. 

280, 300, 737 S.E.2d 601, 611 (2013) ("It is not the function of the courts to pass 

upon the wisdom or folly of municipal ordinances or regulations." (citation 

omitted)). 
 

 

We have carefully reviewed the record on appeal and find Kigre's numerous 

challenges to be without merit. We affirm pursuant to the following authorities: 

Okla. Tax Comm'n v. Jefferson Lines, Inc., 514 U.S. 175, 199 (1995) ("The fair 

relation prong of Complete Auto requires no detailed accounting of the services 

provided to the taxpayer on account of the activity being taxed, nor, indeed, is a 

State limited to offsetting the public costs created by the taxed activity."); 

Commonwealth Edison Co. v. Montana, 453 U.S. 609, 623–24 (1981) ("[I]t was 

not the purpose of the commerce clause to relieve those engaged in interstate 

commerce from their just share of state tax burden even though it increases the cost

of doing business." (quotations and citation omitted)); Complete Auto Transit, Inc. 

v. Brady, 430 U.S. 274, 279–87 (1977) (overruling prior cases finding interstate 

commerce cannot be taxed by states and finding state taxes do not violate the 

Commerce Clause where the activity being taxed has a substantial nexus with the 

taxing jurisdiction, and the tax is fairly apportioned, does not discriminate against 

interstate commerce, and is fairly related to benefits provided by the state); Sunset 

Cay, LLC v. City of Folly Beach, 357 S.C. 414, 425, 593 S.E.2d 462, 467 (2004) 

("'A municipal ordinance is a legislative enactment and is presumed to be 

constitutional. The burden of proving the invalidity of an ordinance is on the party 

attacking it.'" (quoting Whaley v. Dorchester Cnty. Zoning Bd. of Appeals, 337 

S.C. 568, 575, 524 S.E.2d 404, 408 (1999))); Eli Witt Co. v. City of W. Columbia, 

309 S.C. 555, 559, 425 S.E.2d 16, 18 (1992) ("It was not contemplated that the 

various phases of a business should be segregated and only that part taxed which 

was actually carried on within the corporate limits. The [business license] tax was 

imposed for the privilege of maintaining or conducting a place of business within 

that municipality and it was intended that the business should be considered as a 

whole. The gross income or volume of such business is merely made the basis on 

which the tax is graduated." (citation omitted)); Carter, 303 S.C. at 124–25, 399 

S.E.2d at 426 (finding a business license tax which classifies businesses and 

assesses taxes at a graduated rate according to the gross income of the business 

does not constitute an equal protection violation); S. Bell Tel. & Tel. Co. v. City of 

Spartanburg, 285 S.C. 495, 497, 331 S.E.2d 333, 334 (1985) ("The burden is on 

the taxpayer to prove unconstitutionality beyond a reasonable doubt."); 

N. Charleston Land Corp. v. City of N. Charleston, 281 S.C. 470, 474, 316 S.E.2d 

137, 139 (1984) (finding a different municipality's similar business license fee 

ordinance employing the Standard Industrial Classification (SIC) system to be 

constitutionally permissible). 
AFFIRMED. 

TOAL, C.J., PLEICONES, BEATTY, KITTREDGE and HEARN, JJ., 

concur.