Floor Tax Law and Legal Definition
Floor tax refers to a duty levied on distilled spirits that are stored in a warehouse. Failure to file a floor tax return will result in the imposition of penalties and interest and may result in criminal prosecution.
A floor tax is imposed upon the sale or other disposition of any article processed wholly or in chief value from any commodity with respect to which a processing tax is to be levied in amount equivalent to that of the processing tax which would be payable with respect to the commodity from which the article is processed if the processing had occurred on the date when the processing tax becomes effective. [United States v. Butler, 297 U.S. 1, 56 (U.S. 1936)].
