It’s no secret that Virginia is a great East Coast business location. Centrally located on the East Coast, Virginia provides access to ports, rail, air travel and proximity to at least 8 major U.S. metro areas. However, not all Virginia locations are created equally when it comes to business taxes. Before settling on a place to start your business in Virginia, it’s important to look at the local tax laws.
What is the BPOL Tax?
For more than 100 years, many localities in Virginia have required businesses to pay a tax associated with the Business, Professional, and Occupational License (BPOL). This tax, known as the BPOL Tax, is calculated based on a company’s gross receipts without any adjustments for income or expenses.
To determine how much tax they will pay, businesses submit a projected estimate of gross receipts and pay a percentage based on that estimate. If a business fails to meet their projections, the excess is credited toward their taxes for the following year. Businesses with gross receipts of $100,000 or less pay a flat fee, while businesses that make $100,001 or more a percentage of their earnings. The percentage rate a business pays is based on their business classification. Wholesale merchants pay the least at $0.04 per $100 while research and development businesses pay the most at $0.31 per $100 of gross receipts. For small businesses, a flat fee might be a minor nuisance, but if you’re looking to grow your income year-over-year, the BPOL Tax can become quite a burden.
Franklin County Doesn’t Have BPOL Tax
Franklin County, Virginia, isn’t just one of the best places to live, it’s also a great place to start or relocate a business. Franklin County does not have a BPOL tax, freeing up dollars that can be invested back into your business. Not only does Franklin County offer a lower tax burden for businesses, but it also offers a prime location, a premier business park, and great lifestyle options. Business leaders choose to headquarter their companies in Franklin County because they can find everything they need to help their business and their employees thrive.