Bracket System Law and Legal Definition

Bracket system is a method adopted to collect sales tax based on an index provided for a graduated payment depending upon the purchase price of an item. The purpose of this system is:

1. to avoid having the seller collect a tax less than one cent;

2. to avoid requiring the state to figure the exact amount of tax on each sale;

3. to allow the seller to have a ready means for fixing the tax to be collected; and

4. to allow the state to collect about the right amount of tax.