A state tax that is imposed on corporations that are chartered within the state. Franchise taxes are usually based on a percentage of profits, capital stock, or the amount of property held within the state.
Franchise-tax Sentence Examples
The expenses of the state government are met chiefly by special taxes on railway and canal corporations, a franchise tax on the capital stock of other corporations, a collateral inheritance tax and leases of riparian lands.
The state does levy a franchise tax on corporations which incorporate in it, which amount to about 20% o the states revenue, and considered to be just a cost of doing business by most corporations.
Initial charges for incorporating can be as low as $89.00, with most corporations charged $189, with annual franchise tax fees running about $60.00.
A franchise tax is a yearly tax levied by state governments against private businesses and/or other organizations like banks.