A. General information (G.S. 105-33)

1. Scope and Nature
   State privilege license taxes are imposed for the privilege of carrying on the business, exercising the privilege or doing the act named in Article 2 of the Revenue Laws of North Carolina. These taxes are in addition to any regulatory or qualification requirements to engage in the practice of a profession, business or trade. Various State privilege licenses were repealed effective July 1, 1999. The remaining sections of law which impose taxes are listed below:
   
   

   G.S. 105-37.1	Dances, athletic events, shows, exhibitions, and other entertainments
   G.S. 105-38.1	Motion Picture Shows
   G.S. 105-41	Attorneys-at-law and other professionals
   G.S. 105-83	Installment paper dealers
   G.S. 105-88	Loan agencies or brokers, including pawn brokers and check cashers
   G.S. 105-102.3	Banks
   G.S. 105-102.6	Publishers of newsprint publications

   
   Note: Effective July, 1 1999, pawn brokers became subject to license tax under G.S. 105-88, but the maximum on county and city privilege license taxes imposed on a business taxed under this statute does not apply to pawn brokers. Pawnbrokers remain subject to the maximum county and city privilege license taxes imposed under G.S. 153A-152 and G.S. 160A-211.
   
   
2. Tax Year
   The privilege license tax year dates from July 1 to June 30. A required license should be applied for (Form B-202A) before beginning business. Licenses are renewable annually (Form B-202) by July 1 and no grace period is allowed before penalty accrues. Licenses issued under G.S. 105-41 are personal privilege licenses and must be issued in the name of the individual with the individual's social security number.
   
   
3. Penalty (G.S. 105-103, G.S. 105-236)
   It is unlawful to engage in business without obtaining a required privilege license. The penalty for failure to obtain a license accrues at the rate of 5% for each and every 30 days or fraction thereof until the tax is paid, not to exceed 25%. A ten percent (10%) penalty for failure to pay tax when due is also levied.