Gross Receipts Tax

A gross receipts tax is is a tax on the total gross revenues of a company, regardless of their source. It is similar to a sales tax, but it is levied on the seller of goods or services rather than the consumer. This is compared to other taxes which are listed as separate taxes line items on billings, are not directly included in the listed price of the item, and are not a factor in markup or profit on company sales. A gross receipts tax has a pyramid effect which increases the actual taxable percentage as it passes through the product or service life-cycle.