Business and occupation tax

The Business and Occupation tax (often abbreviated B & O tax) is a type of tax levied by the U.S. state of Washington. It is a type of gross receipts tax because it is levied on gross income, rather than net income. While deductions are not permitted for labor, materials, or other overhead expenses, the State of Washington does allow certain deductions, exemptions, and credits, by statute.

Tax rates

The rate of taxation is not uniform for all businesses. Rather, different types of businesses are taxed at different rates, depending upon their classification by the Washington State Legislature and the Washington Department of Revenue. [ [http://dor.wa.gov/Content/FileAndPayTaxes/BeforeIFile/doingBus_CommonBusActivities.aspx Tax classifications for common businesses] ] [ [http://dor.wa.gov/Content/FileAndPayTaxes/BeforeIFile/Def_TxClassBandO.aspx Definitions of tax classifications for the B & O tax] ] Service industry businesses have the heaviest tax burden, with a tax rate of 1.5%, more than double the other major classifications.

Major B & O Classifications and their tax rates

Specialized B & O Tax Classifications

Exemptions, deductions, and credits

Income from exempt activities need not be listed on the B & O tax return. Items claimed as "deductions", however, must be listed as part of gross income before it can be taken as a deduction.

Tax credits for the B & O tax can be due to a taxpayer who overpaid his/her taxes for the prior fiscal year. Additionally, the Legislature has specially created tax credits for certain types of activities.

All exemptions, deductions, and credits are provided for by Chapter 82.04 of the Revised Code of Washington (the chapter which is the legislative basis for the B & O tax) and Title 458 of the Washington Administrative Code (the regulations of the Washington Department of Revenue). Certain provisions of these laws operate in a similar manner as the Internal Revenue Code and U.S. Treasury Regulations. For example, bad debt can be deducted from the B & O tax in much the same way as it can be deducted from the federal income tax [ [http://apps.leg.wa.gov/RCW/default.aspx?cite=82.04.4284 RCW 82.04.4284: Deduction - Bad debts] ] [ [http://apps.leg.wa.gov/WAC/default.aspx?cite=458-20-196 WAC 458-20-196: Bad debts] ] .

References

External links

* [http://dor.wa.gov/docs/pubs/excisetax/bo_pubutil_littertax/bofs.pdf Washington Department of Revenue brochure on the B & O tax] — provides basic information on tax rates, exempt activities, deductions, and credits.
* [http://dor.wa.gov/content/findtaxesandrates/bandotax/ Washington Dept. of Revenue page on B & O tax]
* [http://apps.leg.wa.gov/rcw/default.aspx?Cite=82.04 Chapter 82.04 of the Revised Code of Washington]
* [http://apps.leg.wa.gov/wac/default.aspx?cite=458 Title 458 of the Washington Administrative Code]


Wikimedia Foundation. 2010.

Look at other dictionaries:

  • Tax system in China — Taxes provide the most important revenue source for the Government of the People s Republic of China. As the most important source of fiscal revenue, tax is a key economic player of macro economic regulation, and greatly affects China s economic… …   Wikipedia

  • Business rates in England and Wales — This article is about Business rates in England and Wales. For Scotland, see Business rates in Scotland. Taxation in the United Kingdom This article is part of the series: Politics and government of the United Kingdom Central gover …   Wikipedia

  • tax law — Introduction       body of rules under which a public authority has a claim on taxpayers, requiring them to transfer to the authority part of their income or property. The power to impose taxes is generally recognized as a right of governments.… …   Universalium

  • business — Employment, occupation, profession, or commercial activity engaged in for gain or livelihood. Activity or enterprise for gain, benefit, advantage or livelihood. Union League Club v. Johnson, 18 Cal.2d 275, 108 P.2d 487, 490. Enterprise in which… …   Black's law dictionary

  • tax — A charge by the government on the income of an individual, corporation, or trust, as well as the value of an estate or gift. The objective in assessing the tax is to generate revenue to be used for the needs of the public. A pecuniary burden laid …   Black's law dictionary

  • Business ethics — For the episode from the American television series The Office, see Business Ethics (The Office). Business ethics (also corporate ethics) is a form of applied ethics or professional ethics that examines ethical principles and moral or ethical… …   Wikipedia

  • business — I (affair) noun activity, concern, duty, interest, matter, mission, proceeding, proposition, responsibility, task, undertaking foreign phrases: Allena negotia exacto officio geruntur. The business of another is to be carried out with particular… …   Law dictionary

  • Business rates in Scotland — Business rates is the commonly used name of rates in Scotland, a tax on occupation of non domestic property. Rates are a property tax used to fund local services that dates back to the Poor Law.HistoryThe Poor Law introduced in Scotland in 1579… …   Wikipedia

  • Business overhead expense disability insurance — Business overhead expense (BOE) disability insurance pays the insured’s business overhead expenses if he or she becomes disabled. A BOE policy pays a monthly benefit based on actual expenses, not anticipated profits. It is designed for businesses …   Wikipedia

  • BUSINESS ETHICS — The Role of Wealth Any discussion of business ethics, within any cultural or religious framework, requires at the very outset a definition of the role of material wealth, financial assets, and other forms of economic possessions. Furthermore,… …   Encyclopedia of Judaism

Share the article and excerpts

Direct link
Do a right-click on the link above
and select “Copy Link”

We are using cookies for the best presentation of our site. Continuing to use this site, you agree with this.