Licensing is often misunderstood when it comes to business. Licensing falls into three categories. 1, Authority to do something on behalf of a government agency (I.E., Sale tax collection). 2, Professional or trade license that says you have met some minimal qualification level to practice your profession (I.E., Doctor/Lawyer). 3, Business license to inform a government agency that you exist so they can do random inspections (I.E., Restaurant)