Starting January 1, 2025, the annual exclusion amount for the Commercial Activity Tax (CAT) will increase from $3 million to $6 million. This change means businesses with taxable gross receipts of $6 million or less per calendar year will not be required to pay the CAT.

Quarterly taxpayers expecting taxable gross receipts of $6 million or less in 2025 can cancel their CAT accounts immediately. They should file their final returns by February 10, 2025, and set an effective cancellation date of December 31, 2024.

For businesses with taxable gross receipts exceeding $6 million, a tax rate of 0.26% will apply.

Taxpayers are encouraged to consult with their financial advisors if they have any questions about these changes. More information is available at tax.ohio.gov/catlawchanges.