Mayor signs legislation to raise B&O tax threshold
New $100,000 threshold will help small businesses

SEATTLE – Mayor Greg Nickels has signed legislation raising the threshold for the amount of gross income a business earns before paying business and occupation (B&O) taxes in Seattle to $100,000 from the current $80,000. The legislation was passed by the City Council last week.

"This is the right action at the right time to help more of our small businesses weather the current economic downturn.  I applaud the Council for taking this step to help our local businesses and economy," said Nickels.

The B&O threshold was last raised in 2008 from $50,000 to $80,000. Nickels had proposed raising the threshold to $75,000 in his 2006 proposed budget, but it was not included in the adopted budget. Prior to the 2008 threshold adjustment, Seattle had not adjusted the tax threshold since 1994.

"I'm committed to supporting small businesses, their success is crucial to the success of our city and local economy.  As Budget Chair, I balance this responsibility with that of stewarding a strong budget," said Councilmember Jean Godden.  

The current legislation will affect about 3,000 small businesses, saving them about $500,000 in 2010.

"We are a local family-owned restaurant located close to the Mt. Baker Station with three employees, and this tax break will help our business," said Yilikal Ademe, owner of Café Ibex.

"Raising the B&O tax threshold is welcome tax relief for the smaller businesses in our community," said Cynthia Streltzov, board president of the Rainier Chamber of Commerce. "For a small business, having extra money to invest back into the business, whether for marketing or equipment can really make a difference to a company's bottom line."

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Office of the Mayor