Title
Agenda Item:
B&O Tax Briefing
Body
Issue:
Informational Report on B&O Taxes
City Manager’s Recommendation:
Receive information.
Staff Contact:
Bill Sampson, Senior Accountant, Administrative Services Department, 360.753.8473
Background and Analysis:
The City of Olympia collects B&O Taxes under the State of Washington’s B&O Model Tax Ordinance. The Model Ordinance was adopted in 2003 by the Legislature. Olympia, along with the 39 other B&O tax cities must follow the provisions of the Model Ordinance in order to be able to collect the tax.
Revenues - B&O Taxes 2009 - 2012
2009: $ 4,157,602
2010*: $ 3,889,824
2011: $ 4,238,025
2012: $ 4,317,451
*In 2010 in conjunction with our conversion to licensing businesses through the state, the city moved many businesses to annual filing of B&O taxes which moved those receipts to the 1st quarter of 2011.
Major Exemptions - the following business activities are exempt from B&O taxes.
Non-profit organizations organized as IRS 501(c)(3) organization.
Fraternal and beneficiary organizations (Elks, Eagles etc).
Operation of sheltered workshops income from DSHS for training and care for disabled persons.
Credit Unions.
Premiums or prepayments to Health maintenance organization, health care service contractor, certified health plan.
Insurance business. (State Preemption)
Employees.
Amounts derived from sale, lease or rental of real estate.
Amounts derived from manufacturing, selling or distributing motor vehicle fuel. (State Preemption)
Amounts derived from liquor, and the sale or distribution of liquor. (State Preemption)
Community Events and Farmers Markets.
Major Deductions - the following activities may be deducted from gross revenue.
Membership fees and certain service fees by non-profit youth organization.
Artistic and cultural organizations -- income from business activities.
Day care activities.
Interest on investments or loans secured by mortgages or deeds of trust.
Receipts from tangible personal pr...
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