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English definition of “tax-exempt”

tax-exempt

adjective
 
 
( also tax exempt) TAX, GOVERNMENT
used to describe a product, service, or financial arrangement on which no tax is paid: The poorest families pay no grocery tax because their food stamp purchases are tax exempt.tax-exempt income/contribution The savings account will be limited to €50,000 for tax-exempt contributions. a tax-exempt bond/fund/plan
used to describe an organization that does not have to pay tax: The federal tax code prohibits using income and assets from tax-exempt organizations for personal gain.
tax-exempt status the condition of being tax-exempt: The settlement preserved the tax-exempt status of the bonds issued, thereby protecting investors. We are studying the impact of the federal tax-exempt status provided to college athletic departments.
(Definition of tax-exempt from the Cambridge Business English Dictionary © Cambridge University Press)
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