Business & Occupation Tax

What is a Business & Occupation (B&O)Tax?

Almost all business located or doing business in Washington are subject to a state business and occupation (B&O) tax including:

  • Corporations
  • Limited liability companies (LLCs)
  • Nonprofit organizations
  • Partnerships
  • Sole proprietors

Incurring B&O Taxes

A sale does not have to occur for a business to owe B&O tax. For example, extracting or manufacturing goods for your own use is an activity that generates a B&O tax liability. The B&O tax is calculated on gross income but certain businesses may qualify for certain exemptions, deductions, or credits permitted by law. To find out more about the state B&O tax, visit the Department of Revenue website.

B&O Taxes in the City of Sequim

The City of Sequim does not charge most businesses a B&O tax. Most businesses are required to file B&O taxes directly with the State of Washington, as discussed above.

The City of Sequim does impose a utility B&O tax on any business or public entity providing utility services within Sequim city limits. View more details on utility taxes.