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LSDefine
Simple English definitions for legal terms
stamp tax
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A quick definition of stamp tax:
A stamp tax is a type of tax that the government charges on certain transactions or documents. It is called a stamp tax because people used to have to buy a special stamp to show that they paid the tax. Taxes are charges that the government collects to pay for things like schools, roads, and other public services. They can be paid in different ways, not just with money.
A more thorough explanation:
A stamp tax is a type of tax imposed by the government on various transactions, entities, properties, or individuals to generate public revenue. It is a monetary charge that can be paid in different forms, not necessarily in cash.
- Accrued tax: A tax that has been incurred but not yet paid or payable.
- Accumulated-earnings tax: A penalty tax imposed on a corporation that has retained its earnings to avoid income-tax liability arising once the earnings are distributed to shareholders as dividends.
- Admission tax: A tax imposed as part of the price of being admitted to a particular event.
These examples illustrate how stamp taxes can be applied to different situations. For instance, accrued tax is a tax that has been incurred but not yet paid, while accumulated-earnings tax is a penalty tax imposed on corporations that retain their earnings to avoid income-tax liability. Admission tax, on the other hand, is a tax imposed on individuals attending a particular event.