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Business License Fee Increase

Business License Fee Increase  

The Tacoma City Council recently reviewed and updated the business license fee structure to better align business license fees with the size of businesses based on annual worldwide gross income.  

 

Tacoma is a growing city, and under the previous business license fee structure, which has not changed since 2017, a small local retailer was paying the same business license fee as a multimillion-dollar company. 

 

In 2023, annual business license fees increased for all businesses, except Tacoma’s smallest businesses who will continue to pay $25 this year. Ninety percent of businesses in Tacoma will see either no increase in their annual business license fee, or a $20 or $50 increase based on their annual gross income*. The remaining 10 percent of larger businesses will see more substantial increases. 

 

Gross Income* 2022 Fee 2023 Fee 2024 Fee 
Less than $12,000
$25 $25 $37.50
$12,000 - $250,000  $110  $130

$190

$250,001 - $1,000,000
$250 $300 $435
$1,000,001 - $5,000,000
$250  $1,000 $1,500
Over $5,000,000
$250  $1,500 $2,000
*Gross income is total worldwide income from business activities inside or outside of Tacoma, and regardless of business location.
 

In 2024, annual business license fees will increase for all businesses as shown in the chart above.

 

Overall, the new fee structure is projected to add more than $10 million into the General Fund over the next biennium, providing the City of Tacoma with additional flexibility in supporting the needs of businesses as well as the broader community.

With the passage of Substitute Ordinance 28838, the City Council’s Economic Development Committee is required to work with stakeholders and recommend any adjustments to the business license fees and tiers for 2025 and beyond. Such recommendation is due to the City Council by September 30, 2023. 

 

You can also share your thoughts on this and other topics the City Council has jurisdiction over during Community Forum, on the 2nd and 4th Tuesdays of every month. 

 

2023 License Renewal Invoice 

Tax & License billed the 2023 business license fee according to our records of a company's annual gross income. Gross income is total worldwide income from business activities inside or outside of Tacoma, and regardless of business location.

 

If you find that your 2023 license fee is incorrect according to your anticipated 2023 gross income, please choose your payment option and do the following: 

  • Online, Paybox, or Phone renewal: call 253-591-5252 prior to paying to have your fee adjusted.
  • Mail renewal: cross off the amount invoiced and pay the correct fee. 

For questions about your Tax & License account, please contact us.  

 

Resources

Business License Fact Sheet

Tax and License Business Incentives

COVID-19 Relief for Businesses

Crime Reduction Plan