What is the business privilege and/or mercantile tax?

Business privilege and mercantile taxes are levied by the municipality and/or school district in which a business is located and are either flat rate or more typically based on the gross receipts of such a business.

Your municipality or school district may impose a tax on each dollar of gross annual receipts for a business within the municipality or school district, whether for gain or profit including financial businesses, professions, vocations, services, construction, or other commercial activities.