South Carolina Lawmakers Weighed Tourism Tax Expansion
Officials in Myrtle Beach are seeking to revise a state law to retain more tourism tax revenue for local building projects.
Updated on Oct. 6, 2026 in Hospitality
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Myrtle Beach officials and South Carolina state lawmakers are exploring potential expansions to a state tourism development fee. The proposal seeks to increase local revenue retention for large-scale construction projects.
Why it matters
Current law limits the fee usage to specific municipalities and imposes 10-year re-approval windows, which complicates long-term infrastructure planning. Revising these rules could grant cities like Myrtle Beach greater financial control over regional tourism growth.
The tourism development fee is a 1 percent sales tax that brought in $45.5 million last year. Myrtle Beach officials now propose retaining 40 percent of these funds, doubling the current 20 percent share.
The players
Bill Herberksman
He is a South Carolina State Representative who introduced legislation in January 2026 to modify the distribution of tourism development fees.
Myrtle Beach
It is the only city in South Carolina currently authorized to utilize the 1 percent tourism development fee.
The details
City and chamber officials are drafting a proposal to present to state legislators that would extend the tax's approval window from 10 years to 20 years. This shift is intended to facilitate the bonding of long-term construction projects, such as the development of land at the former Pavilion site.
Timeline
The tourism development fee was originally established in 2009.
State Representative Bill Herberksman introduced legislation in January 2026 to modify fee distribution.
City officials held discussions with the Horry County legislative delegation on September 15, 2026.
Officials expect to finalize their tax proposal by mid-October 2026.
Market Landscape
This proposal reflects a broader shift among high-traffic South Carolina municipalities aiming to capture more direct funding from tourism-driven economic activity. By moving away from the 2009 tourism development fee law's restrictive 10-year cycle, the city seeks to transition from marketing-heavy spending to infrastructure-led development.
The proposed changes could lead to significant new local construction projects in Myrtle Beach, potentially altering local infrastructure and urban development. Residents and business owners should monitor the legislative process to see how tax revenue allocation shifts might impact regional investment and future tourism infrastructure.
The takeaway
Securing longer approval windows is critical for municipalities to stabilize financing for major capital projects that take years to complete. This effort highlights the tension between using tourism taxes for immediate marketing versus long-term urban construction.
What happens next
City and chamber officials are scheduled to finalize their formal tax proposal by mid-October 2026.
Further reading
For more context on how regional tourism affects the local economy, visit the South Carolina Hospitality section.
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