Privilege tax

A privilege tax is a tax levied in exchange for a privilege or license granted to the taxpayer.

The fee for registering a motor vehicle is one example of a privilege tax.

For example, Arizona's transaction privilege tax is a gross receipts tax on business.

In the 1911 case of Flint v. Stone Tracy Co., the United States Supreme Court upheld the constitutionality of a corporate income tax, determining that it was an indirect tax on the privilege of doing business as a corporation.

This tax-related article is a stub.