Gross Receipts and Margin Taxes

State governments have traditionally raised revenue from business by taxing corporate income. But in recent years the growing difficulty of administering state corporate income taxes has prompted a resurgence in one of the world’s oldest broad-based tax structures: the gross receipts tax, also known as the “turnover tax.”

Gross receipts taxes have a simple structure, taxing all business sales with few or no deductions. Because they tax transactions, they are often compared to retail sales taxes. However, while well designed sales taxes apply only to final sales to consumers, gross receipts taxes tax all transactions, including intermediate business-to-business purchases of supplies, raw materials and equipment. As a result, gross receipts taxes create an extra layer of taxation at each stage of production that sales and other taxes do not—something economists call “tax pyramiding.”


Featured Research

State Tax Changes as of January 1, 2020

December 20, 2019

Ranking Corporate Income Taxes on the 2020 State Business Tax Climate Index

November 6, 2019

Oregon’s Proposed Gross Receipts Tax Is More Damaging Than Proposed Value-Added Tax

March 13, 2019

There are Better Ways to Raise Revenue in Oregon Than a Gross Receipts Tax

March 6, 2019

Resisting the Allure of Gross Receipts Taxes: An Assessment of Their Costs and Consequences

February 6, 2019

Tax Trends Heading Into 2019

December 19, 2018


Related Articles

California Senate Bill Seeks Tax Credit Transparency from Large Corporations but Misses the Mark

Combined State and Federal Corporate Income Tax Rates in 2020

State Tax Changes as of January 1, 2020

What Voters Told Us about Taxes on Election Day

Ranking Corporate Income Taxes on the 2020 State Business Tax Climate Index

Results of 2019 State and Local Tax Ballot Initiatives

Will West Virginia Reduce the Tax Burden on Manufacturing?

State and Local Tax Ballot Measures to Watch on Election Day 2019

California Cities Want to Cash in on Marijuana

Washington Voters to Weigh in on 12 Tax Questions This November

Texas Tackles Property Tax Concerns, Can Square Up to Margin Tax

Proposed Referendum is an Opportunity for Oregonians to Reassess the State’s Gross Receipts Tax

State Corporate Income Taxes Increase Tax Burden on Corporate Profits

Oregon Another Step Closer to a Gross Receipts Tax Funding Public Education

Testimony: Oregon Should Reevaluate the Proposed Gross Receipts Tax to Raise Revenue for Public Education

Oregon’s Proposed Corporate Activity Tax Would Harm Low-Income Oregonians the Most

Why State-for-Local Tax Swaps Are So Hard to Do

Oregon Introduces Gross Receipts Tax Legislation to Beat the Clock

Oregon Shouldn’t Adopt a Margin Tax in Its Search for Revenue

Oregon’s Proposed Gross Receipts Tax Is More Damaging Than Proposed Value-Added Tax