A privilege license is an excise tax, levied on the “privilege”

of conducting a particular trade or business in a county or city.

In North Carolina, privilege licenses have been issued since 1862.

The Town of Waxhaw requires any person conducting business within the “town limits” to obtain a valid

Town ofWaxhaw Privilege License.

The privilege license tax is a revenue source. It cannot be used to regulate businesses.

Unlike some sources of revenue, the privilege license revenues are not designated for a certain purpose, revenues support the general fund.

The privilege license year is July 1st to June 30th. Any person that conducts business after December 31st and before June 30th will pay half of the normal privilege license tax.

The penalty for a delinquent privilege license is 5% per month or fraction thereof with a maximum penalty of 25% of the amount of the privilege license tax due.

Schedule

Schedule A This business:Is not regulated by NC General StatutesPays license tax based on gross sales/receiptsWill pay tax in Schedule A and Schedule B if business activities fall under both categories for the business

Schedule B and/or Schedule C

This business:Is limited by North Carolina General Statutes or is a Town of Waxhaw Tax.Could pay based on number of employees if the business activities do not have gross receipts to list under Schedule A. Will pay tax in Schedule A and Schedule B if business activities fall under both categories for the business

Exemptions Any business that does additional activities other than what is exempt must pay a privilege license tax on the activities that are not covered by the exemption.

What are gross sales/receipts?Gross sales/receipts are the total income that a company

claims before any expenses or deductions.

Why go to gross sales/receipts?To have the Privilege License tax become more

equitable. Larger businesses pay a larger tax, while a smaller business pays a smaller tax.

How do businesses determine gross sales/receipts?

New businesses will estimate their gross sales/receipts based on a good-faith 12 month estimation.

Established businesses will use the figure from their prior year federal tax return.

► Restaurant . . . . . . . . . . . . . . . . . . . . . . . $42.50► Sundries . . . . . . . . . . . . . . . . . . . . . . . . . 4.00► Ice Cream . . . . . . . . . . . . . . . . . . . . . . . . 2.50► All trades, . . . . . . . . . . . . . . . . .(min.) . . . 50.00

(Sell of bottled water, chips, fruit-cups, juice, milk, mints)

► Beer and Wine . . . . (due May 1) . . . . . . . . . . 30.00

Total Tax due $129.00

Restaurant . . . . . . . . . . . . . . . . . . . . . . $42.50

Sundries . . . . . . . . . . . . . . . . . . . . . . . . 4.00

Ice Cream . . . . . . . . . . . . . . . . . . . . . . . . 2.50

Catering = All trades . . (Grossing $300,000) . . . . 45.00 (in addition to the sell of bottled water, juice, milk)

-------------- Tax due $ 94.00 Beer/Wine license are due May 1 of each year.

Gross Receipts.15

.15 per $1,000

200,000   30250,000   38300,000   45500,000   75600,000   90750,000   1131,000,000   1502,000,000   3003.000,000   4504,000,000   6005,000,000   7506,000,000   9007,000,000   1,050

8,000,000   1,2009,000,000   1,35010,000,000   1,50025,000,000   3,75035,000,000   5,25050,000,000   7,50060,000,000   9,00075,000,000   11,250100,000,000   15,000

Gross receipts formula at

$.15 per $1,000.

Small Retail Business Gross Receipts of $185,000

Tax would be: $30.00.~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

Larger Retail EstablishmentGross of $755,500

(850,750/1,000= 850.75)850.75 x .15 = $127.61 tax

All businesses, trades, professions, gaming devices or other undertakings, initiated for profit or gain, shall be taxed

at the rate of $0.15 per $1,000.00 of annual gross receipts with the minimum tax not to be less than $30.00.

Small Grocery/Convenience Store:

A grocery store or convenience store whose total gross is $900,000.

It would possibly pay: 

Under Schedule B: Tax GrossAuto Accessories: $12.50 $100,000 - (Oil, Gas,

Washer fluid)Chain Store: 50.00Ice Cream: 2.50 25,000 Sundries: 4.00 75,000 (soft drinks

& tobacco products)Beer & Wine: 15.00 100,000 (Due May 1)

Total for Schedule B: $84.00 300,000 Subtract Schedule B gross from total gross. (900,000 - 300,000 = 600,000)Therefore, 600.0 x .15 = $ 90.00

+ 84.00 $174.00 - tax to be paid for annual

license 

This is only an example, it is not limited to these classifications. It depends on the operations of the business.

The imposition of taxes based on the gross receipts basis does not prevent the  application of  former Schedule B to be in revised Ordinance. 

• All Business, Trade . . . . . . . . . . . $ 34,500,000 . . . . . . . . . . . 5,175.00• Bicycles . . . . . . . . . . . . . . . . . . . . . . . $500,000 . . . . . . . . . . . .

25.00• Auto Repair &/or Accessories . . . . $ 1,500,000 . . . . . . . . . . . . 12.50• Firearms . . . . . . . . . . . . . . . . . . . . . . . $500,000 . . . . . . . . . . .

50.00• Video Movies . . . . . . . . . . . . . . . . . . . $ 1,500,000 . . . . . . . . . . .

25.00• Radio/TVs . . . . . . . . . . . . . . . . . . . . . $ 3,000,000 . . . . . . . . . . . .

5.00• Recorders, etc . . . . . . . . . . . . . . . . . . $ 500,000 . . . . . . . . . . . . 5.00• Ice Cream . . . . . . . . . . . . . . . . . . . . . $ 2,000,000 . . . . . . . . . . . .

2.50• Sundries . . . . . . . . . . . . . . . . . . . . . . . $ 3,500,000 . . . . . . . . . . .

4.00• Beer/Wine . . . . . . . . . . . . . . . . . . . . . . $ 2,500,000 . . . . . . . . . .

15.00 Total tax due ---- $ 5,319.

5 Employees . . . . . . . . . . . $100.00

10 Employees . . . . . . . . . . . $150.00

23 Employees . . . . . . . . . . . $200.00

37 Employees . . . . . . . . . . . $250.00

Day Care with 15 childrenAnnual Gross - $75,000 . . . . . . . . . . . .

$30.00

Day Care with 75 childrenAnnual Gross - $475,000 . . . . . . . . . . . .

$71.00

Day Care with 150 childrenAnnual Gross - $800,000 . . . . . . . . . . .

$120.00

HAIR SALONTotal Gross - $150,000

4 Operators (2.50 x 4) $10.00

Product Sales (gross $30,000)

30.00Tanning bed(gross $10,000)

--------------Total tax due $40.00

ANY QUESTIONS

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