2. 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 of Waxhaw Privilege License.

3.  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 1 st to June 30 th. Any person that conducts business after December 31 st and before June 30 th 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.

4. Schedule Schedule AThis business:  Is not regulated by NC General Statutes  Pays license tax based on gross sales/receipts  Will 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.

5. 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.

7. ► 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

8.  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.

9. Gross Receipts.15.15.15 per $1,000 200,000 30 250,000 38 300,000 45 500,000 75 600,000 90 750,000 113 1,000,000 150 2,000,000 300 3.000,000 450 4,000,000 600 5,000,000 750 6,000,000 900 7,000,000 1,050 8,000,000 1,200 9,000,000 1,350 10,000,000 1,500 25,000,000 3,750 35,000,000 5,250 50,000,000 7,500 60,000,000 9,000 75,000,000 11,250 100,000,000 15,000 Gross receipts formula at $.15 per $1,000.

10. Small Retail Business Gross Receipts of $185,000 Tax would be: $30.00. ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Larger Retail Establishment Gross 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.

11. Small Grocery/Convenience Store: A grocery store or convenience store whose total gross is $900,000. It would possibly pay: Under Schedule B: Tax Gross Auto Accessories:$12.50 $100,000 - (Oil, Gas, Washer fluid) Chain Store: 50.00 Ice 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.

12. 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.

13.  5 Employees........... $100.00  10 Employees........... $150.00  23 Employees........... $200.00  37 Employees........... $250.00

14.  Day Care with 15 children Annual Gross - $75,000............ $30.00  Day Care with 75 children Annual Gross - $475,000............ $71.00  Day Care with 150 children Annual Gross - $800,000........... $120.00

15. HAIR SALON Total Gross - $150,000 4 Operators (2.50 x 4) $10.00 Product Sales(gross $30,000) 3 0.00 Tanning bed(gross $10,000) -------------- Total tax due $40.00

16. ANY QUESTIONS ?????