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The Commercial Activity Tax (CAT) is a business privilege tax measured by a business’ gross receipts. The CAT was phased-in over a five year period starting with tax year 2005. The CAT replaces the corporate franchise and tangible personal property taxes. As a result of the phase-out of the tangible personal property tax, a distribution was created to reimburse schools and local governments for revenue losses. For State Fiscal Year FY 2012, the allocation, after the 0.85% distribution to the administration fund: 25.0% to the state's General Revenue Fund, 52.5% to School District Tangible Property Tax Replacement Fund (Fund 7047) and 22.5% to the Local Government Tangible Property Tax Replacement Fund (Fund 7081). In FY 2013 this changes to 50.0% to the state's General Revenue Fund, 35.0% to Fund 7047 and 15.0% to Fund 7081. The Department of Education reimburses the schools and the Department of Taxation reimburses local governments. Payments are made through the county auditors.
