Gross Receipts Tax

A Gross Receipts Tax (GRT) is a type of tax levied on the total revenue a business generates from sales before any expenses are deducted. Unlike traditional sales tax, which applies only to the sale of products or services, a GRT is calculated on the entire income of the business. This means that businesses pay tax on all their receipts, regardless of their profitability. GRT is used by some states and local governments as a simpler alternative to income tax, aiming to diversify revenue sources, though it can be seen as burdensome for lower-margin businesses.