TaxesTaxes are compulsory charges levied by a government for the purpose of financing services performed for the common benefit. This does not include specific charges made to people or property for current or permanent benefits such as special assessments, or fees for services charged only to those who pay for and use those services.
The City of Edmonds Does Not Collect A City Business and Occupation Tax or Employee/Head Tax - All individuals and firms doing business in Edmonds, whether located inside or outside the City limits, are not subject to a City business and occupation tax, or employee/head tax.
Information about the taxes of most interest to businesses are listed below. A helpful overview is published by the Washington State Department of Revenue:
- Business Tax Overview (PDF) - published by the Washington State Department of Revenue. The state of Washington does not have a corporate, unitary, or personal income tax. However, Washington businesses are subject to three major taxes either administered or overseen by the Department of Revenue: Business and occupation tax, Retail sales/use tax, and Property tax
Washington's property tax system is a significant source of revenue for state and local governments, including the City of Edmonds. In Snohomish County, property tax assessment is performed by the County Assessor’s Office and collection performed by the County Treasurer’s Office. Property tax revenues are then distributed to the City and other governments as appropriate.
Although property taxes represent a significant source of funding for City services (approximately 39%), the portion of each property owner’s tax bill that is distributed to the City is approximately 21%. In 2011, the total property average tax rate in Edmonds is $9.95 per $1,000 of assessed valuation, with $2.12 (per $1,000 assessed valuation) of that going to the City of Edmonds.
The links below provide information to help property owners understand how property taxes are calculated and collected:
- Homeowners Guide to Property Taxes (PDF) - published by the Washington State Department of Revenue.
- Snohomish County Assessor's Office
The retail sales tax is Washington’s principal tax source. Local retail sales and use taxes provide important funding sources for local governments, including the City of Edmonds. Sales and use taxes are collected by the state Department of Revenue. The state portion is deposited in the state General Fund. City and county taxes are returned to the local governments. Specifically designated taxes must be used to operate the program(s) they fund. The Sales and Use tax rate collected within the City of Edmonds = .103 (City of Edmonds = .038 and the State of Washington = .065)
This tax is imposed on utilities. Typical business activities affected by this tax are telephone, cellular, gas, electric, cable and garbage. The rate is 6%. City-operated utilities (water, wastewater / sewer, and stormwater) also are subject to a utilities tax. The Utility Taxes for the Water System is 17.07%, Sewer System is 10.0% and Stormwater System is 10.0%.
Business Incentives in Edmonds
Washington State has a stable, uncomplicated tax system that has remained essentially unchanged since 1935. The State's tax system features:
- No corporate tax
- No unitary tax
- No inventory tax
- No personal tax
- No tax on interest, dividends, or capital gains