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Home > Services > Tax > State & Local Tax > Ohio Commercial Activities Tax
Ohio Commercial Activities Tax
The State of Ohio has implemented sweeping legislation that drastically reforms virtually every type of tax that is imposed in the state. What is most important to note about these changes is that they may have direct impact on persons and business entities that WERE NOT previously subject to taxation in Ohio. This article summarizes only the most significant change—the implementation of the Commercial Activities Tax.
The recent legislation has created a new tax—the Commercial Activities Tax (CAT). The CAT is an annual privilege tax that will replace the Corporate Franchise Tax over a five year phase-in period starting in 2005.
What is most critical to note about the CAT is that it is not an income tax, and so the Ohio Department of Taxation is taking a much more aggressive position with respect to nexus creating activities. Physical presence is not required to be subject to the CAT. In fact, the Department, in Information Release CAT 2005-02, has stated that they will take the position that mere economic presence will be sufficient to subject a person or business to the CAT.
Solutions Beyond the Basics
You need tax professionals with experience, resources, and multistate knowledge. Virchow Krause can help. Our state and local tax services include the Ohio Commercial Activities Tax, Michigan Single Business Tax, and many other taxes.
Advantages for You
The benefits of using our Ohio Commercial Activities Tax services:
- Minimize state and local tax costs.
- Save time and effort in registering with the State.
- Incorporating the Commercial Activities Tax into your Ohio tax compliance process.
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