Kent, WA Local Taxes & Fees: Business Tax Classification (2026)
Key Facts
- Retailing rate
- 0.001 (0.1%) of gross proceeds, since 1/1/22
- Catch-all 'other' rate
- 0.002 (0.2%) of gross income, since 1/1/22
- Small-business exemption
- Gross receipts up to $250,000/year exempt
- Retailing high-end relief
- Phases out above $20M (2022-24), $100M (2025+)
- Classification count
- 7 gross-receipts categories plus square-footage tax
- Multiple activities
- Taxed under each applicable classification
Summary
Kent's B&O tax, KCC 3.28.050, sorts businesses into classifications, extracting, manufacturing, wholesaling, retailing, printing/publishing, retail services, and a catch-all 'other,' each taxed at a different rate, plus a separate square-footage tax, with a $250,000 annual gross-receipts exemption.
Upon every person engaging within the city in the business of making sales at retail, as to such persons, the amount of tax with respect to such business shall be equal to the gross proceeds of such sales of the business, without regard to the place of delivery of articles, commodities, or merchandise sold, multiplied by the rate of 0.00046 through December 31, 2021, and multiplied by the rate of 0.001 effective January 1, 2022. [...] Upon every other person engaging within the city in any business activity other than or in addition to those enumerated in the above subsections; as to such persons, the amount of tax on account of such activities shall be equal to the gross income of the business multiplied by the rate of 0.00152 through December 31, 2021, and multiplied by the rate of 0.002 effective January 1, 2022. [...] The gross receipts tax imposed in subsection (A) of this section shall not apply to any person engaging in any one or more business activities which are otherwise taxable pursuant to this section, whose value of products, including byproducts, gross proceeds of sales, and gross income of the business, as the case may be, from all activities conducted within the city during any calendar year does not exceed the threshold amount of $250,000.
Official source re-checked September 8, 2026: no newer edition of the code had been published (publisher’s edition: current through Ordinance 4542, passed June 16, 2026).
Full Breakdown
020 authority to license for revenue. 050 sets seven gross-receipts classifications in subsection (A): extracting, manufacturing, wholesaling, retailing, printing and publishing (including extracting or processing for hire), retail services, and a residual 'any other business activity' category that sweeps in services, royalties, and custom software work not covered elsewhere. 2 percent) of gross income, also effective January 1, 2022. 060(A). Separately, subsection (B) imposes a square-footage tax measured by a business's warehouse and office floor space within the city, with the larger of the gross-receipts or square-footage calculation controlling under the chapter's introductory paragraph.
050(C)(1) exempts the gross-receipts tax entirely for any person whose value of products, gross proceeds of sales, and gross income from all city activities does not exceed $250,000 in a calendar year. Retailing also carries its own high-end relief in subsection (D), phasing out the gross-receipts retailing tax above $20,000,000 in sales for 2022-2024 and above $100,000,000 for 2025 onward, adjusted annually for the Seattle-area CPI-W starting in 2026.
Violations & Fines
KCC 3.28.028 folds enforcement into the administrative provisions of Chapter 3.29 KCC, which apply to the B&O tax except where 3.28 states otherwise. Businesses must register under KCC 3.29.025 and file returns under KCC 3.29.040, with the finance director authorized to assess underpaid tax plus interest under KCC 3.29.090 and to pursue collection for late payment, disregarded instructions, or evasion under KCC 3.29.110. A business that misreports its classification, and therefore its tax rate, risks a deficiency assessment for the difference between what it paid and the correct classification's rate, plus statutory interest and any applicable late-payment penalty under the Chapter 3.29 administrative scheme.
Frequently Asked Questions
What business tax classifications does Kent use?
What is Kent's B&O tax rate for retail sales?
Is there a small-business exemption from Kent's B&O tax?
Sources & Official References
Other rules in Kent
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