Chapter 5.48
UTILITY OCCUPATIONS TAX LICENSE
Sections:
5.48.010 City powers to license for revenue.
5.48.030 License – Required – Operation without deemed chapter violation.
5.48.050 Occupations subject to tax – Amount.
5.48.060 Exceptions and deductions from gross income.
5.48.063 Allocation of income for cellular telephone service.
5.48.070 Tax year and preparation of returns.
5.48.080 Recordkeeping and inspection requirements.
5.48.090 Confidentiality required – Exceptions.
5.48.100 Examination and investigation authorized when.
5.48.110 Refunds and statements for balance due authorized when.
5.48.120 Liability for license fee or tax payment – Notice required.
5.48.130 Unlawful acts designated.
5.48.140 Disposition of moneys.
5.48.010 City powers to license for revenue.
The provisions of this chapter shall be deemed as exercise of the power of the city to license for revenue. (Ord. 2087 § 2, 1983).
5.48.020 Definitions.
In construing this chapter, except when otherwise plainly declared or clearly apparent from context, the following definitions shall be applied:
A. “Cellular telephone service” means a two-way voice and data telephone/telecommunication system based in whole or substantially in part on wireless radio communications and which is not currently subject to regulation by the Washington Utilities and Transportation Commission (WUTC). Cellular telephone service includes cellular mobile service. The definition of cellular mobile service includes other wireless radio communications services such as specialized mobile radio (SMR), personal communications services (PCS) and any other evolving wireless radio communications technology which accomplishes the same purpose as cellular mobile service.
B. “Cable television service” means the one-way transmission of video programming and associated nonvideo signals to subscribers together with subscriber interaction, if any, which is provided in connection with video programming. For the purposes of this definition, open video services in which video programming is provided shall be construed as a cable television service, to the extent allowed by federal law.
C. “Competitive telephone service” means the providing by any person of telephone telecommunications equipment, or apparatus, or service related to that equipment or apparatus such as repair or maintenance service, if the equipment or apparatus is other than toll service which is of a type which can be provided by persons that are not subject to regulation as telephone companies under RCW Title 80 and for which a separate charge is made. Transmission of communications through cellular telephones is classified as “telephone business” rather than “competitive telephone service.”
D. “Gross income” means the value proceeding or accruing from the sale of tangible property or service, and receipts (including all sums earned or charged) by reason of the investment of capital in the business engaged in, including rentals, royalties, fees or other emoluments however designated, derived wholly within the city (excluding receipts or proceeds from the use or sale of personal property constituting plant or equipment not sold in the ordinary course of trade or any interest therein, and proceeds and receipts from the sale of notes, bonds, mortgages or other evidence of indebtedness, or shares of stock and the like) and without any deductions on account of the property sold, the cost of materials used, labor costs, interest paid, or any expense whatsoever, and without any deduction on account of losses.
E. “Person” or “persons” means a person or persons of either sex, firms, copartnerships, corporations or other associations of natural persons, whether acting by themselves or by servants, agents or employees.
F. “Taxpayer” means any person liable for the license fee or tax imposed by this chapter.
G. “Tax year” or “taxable year” means the calendar year commencing on January 1st and ending on the last day of December.
H. “Telephone business” means the business of providing access to a local telephone network, local telephone network switching service, toll service, cellular telephone services, coin telephone service, or providing telephonic, video, data or similar communication or transmission for hire, via a local telephone network, toll line or channel, cable, microwave, or similar communication or transmission system. It includes cooperative or farmer line telephone companies or associations operating an exchange. “Telephone business” does not include the providing of competitive telephone service, the providing of cable television service, or the providing of broadcast services by radio or television stations. (Ord. 3240 § 1, 2005).
5.48.030 License – Required – Operation without deemed chapter violation.
A. No person shall engage in or carry on any business, occupation, pursuit or privilege for which a license fee or tax is imposed by this chapter without first having obtained, and being the holder of, a valid and subsiding license so to do, to be known as an “occupations license.”
B. Any taxpayer who engages in, or carries on, any business subject to tax hereunder without first obtaining his occupations license so to do, shall be guilty of a violation of this chapter for each day during which the business is so engaged in or carried on, and any taxpayer who fails or refuses to pay the license fee or tax, or any part thereof, on or before the due date shall be deemed to be in operation without a license. (Ord. 2087 § 4, 1983).
5.48.040 License tax year.
A. All occupations licenses shall be for the tax year for which issued and shall expire at the end of such tax year.
B. Such occupations license and the fee or tax therefor, imposed hereby, shall be for the year commencing on the first day of January and ending on the last day of December of each year. (Ord. 2087 § 5, 1983).
5.48.050 Occupations subject to tax – Amount.
There is levied upon the persons, on account of business activities, annual license fees or occupation tax. The persons engaged in or carrying on the business shall be charged with collection of the tax as a condition of doing business, and the basic tax shall be levied hereafter upon their subscribers at the rate set forth below and in proportion to their contribution to gross income as hereinbefore defined:
A. Electric Lights and Power, and Natural or Manufactured Gas. Upon every person engaged in or carrying on the business of selling or furnishing electric lights and power, or natural or manufactured gas, a fee or tax equal to:
1. Six percent to that portion of gross income from $1.00 to $5,000 derived from a single customer collected monthly.
2. Four percent to that portion of gross income in excess of $5,000 derived from a single customer collected monthly.
B. Cable Television. Upon every person engaged in or carrying on the business of selling or furnishing cable television service, a fee or tax equal to seven percent of the total gross income from such business within the city.
C. Sewer Service. Upon every person engaged in or carrying on the business of furnishing sewer service, a fee or tax equal to eight and one-half percent of the total gross income from such business within the city.
D. Garbage Service. Upon every person engaged in or carrying on the business of selling or furnishing garbage service, a fee or tax equal to seven percent of the total gross income from such business within the city.
E. Telephone Business. Upon any telephone business there shall be levied a tax equal to six percent of the total gross operating revenues, including revenues for intrastate toll, derived from the operation of such businesses within the city.
F. Domestic Water. Upon every person engaged in the business of selling or supplying domestic water, a tax equal to seven percent of the total gross income from such business within the city, not including revenue derived from the delivery of water for fire suppression. (Ord. 3702 § 1, 2016).
5.48.055 Utility tax on domestic water – Expiration date.
Repealed by Ord. 3668. (Ord. 3643 § 2, 2014).
5.48.060 Exceptions and deductions from gross income.
A. There shall be excluded from the total gross income, or total gross operating revenues, upon which the license fee or tax is computed, the following:
1. Transactions in interstate or foreign commerce, or from business done for the United States and the state, or their officers or agents or any amounts paid by the taxpayer to the United States and the state, as excise taxes levied or imposed upon the sale or distribution of property or services, or as an occupations tax.
2. That portion of gross income derived from charges to another telecommunications company, as defined in RCW 80.04.010, for connecting fees, switching charges, or carrier access charges relating to intrastate toll telephone services, or for access to, or charges for, interstate service.
3. Charges by a taxpayer engaging in a telephone business to a telecommunications company, as defined in RCW 80.04.010, for telephone service that the purchasers buys for the purpose of resale.
4. Adjustments made to a billing or to a customer account or a telecommunications company accrual account in order to reverse a billing or a charge that has been made as a result of third party fraud or other crime and was not properly a debt of a customer.
5. Charges which are passed on to the subscribers by a telephone company pursuant to tariffs required by regulatory order to compensate for the cost to the company of the tax imposed by this chapter, or charges to cellular telephone service subscribers passed on to compensate for the cost to the company of the tax imposed by this chapter.
B. Deductions. There shall be allowed as a deduction the following:
1. As to cellular telephone service, cash discounts, and credit losses actually sustained by a taxpayer on an accrual basis.
2. As to electric lights and power, uncollectibles and credit losses actually sustained by a taxpayer on an accrual basis. (Ord. 3240 § 3, 2005).
5.48.063 Allocation of income for cellular telephone service.
A. Service Address. Payments by a customer for the telephone service from telephones without a fixed location shall be allocated among taxing jurisdictions to the location of which the customer’s principal service address during the period for which the tax applies.
B. Presumption. There is a presumption that the service address a customer supplies to the taxpayer is current and accurate, unless the taxpayer has actual knowledge to the contrary.
C. Roaming Phones. When the service is provided while a subscriber is roaming outside the subscriber’s normal cellular network area, a gross income shall be assigned consistent with the taxpayer’s accounting system to the location of the originating cell site of the call, or to the location of the main cellular switching office that switched the call.
D. Dispute Resolution. If there is a dispute among one or more other cities and/or the taxpayer as to the service address of a customer who is receiving cellular telephone services, and the dispute is not resolved by negotiation among the parties, then the dispute shall be resolved by the city and the other city or cities by submitting the issue for settlement to the Association of Washington Cities (AWC). The taxpayer shall have no further liability with respect to additional taxes on the disputed revenues, but will change his or her billing records for future revenues to comport with the settlement facilitated by AWC. (Ord. 2706 § 4, 1995).
5.48.066 Rate change.
No change in the rate of tax upon persons engaging in providing cellular telephone service shall apply to business activities occurring before the effective date of the change, and, except for a change in the tax rate authorized by RCW 35.21.870, no change in the rate of the tax may take effect sooner than 60 days following the enactment of the ordinance establishing the change. The finance director, or designee, shall send to each cellular service company a copy of any ordinance changing the rate of tax upon cellular telephone service promptly upon its enactment. (Ord. 2706 § 5, 1995).
5.48.070 Tax year and preparation of returns.
A. The tax year will be divided into 12 months and the tax receipts remitted on a monthly basis. The tax collected each month shall be remitted to the city clerk-treasurer on or before the twenty-fifth day of the following month.
B. On or before the twenty-fifth day of each month every business collecting the tax shall complete and file with the city clerk-treasurer an occupation tax form for the preceding month. The tax forms will be provided by the clerk-treasurer. The taxpayer shall complete the forms giving the information necessary to enable the treasurer and the taxpayer to arrive at the lawful amount of the fee or tax, and shall sign the same by affidavit swearing or affirming that the information therein given is full and true and that he knows the same to be so.
C. Every such application or return shall be accompanied by bank draft, certified check or United States money order, payable to the city clerk-treasurer, or by cash, in the amount of the tax or fee for the preceding quarter required by the provisions hereof. (Ord. 2087 § 8, 1983).
5.48.080 Recordkeeping and inspection requirements.
Each taxpayer shall keep books or records reflecting the amount of his gross income, and such books or records shall at reasonable times be open to the inspection of the city treasurer, or agent, for verification of the taxpayer’s return or application. (Ord. 2087 § 9, 1983).
5.48.090 Confidentiality required – Exceptions.
The applications or returns made to the city clerk-treasurer pursuant to this chapter, shall not be made public, nor shall they be subject to the inspection of any person except the mayor, city attorney, city clerk-treasurer or his agent, and members of the city council. (Ord. 2087 § 10, 1983).
5.48.100 Examination and investigation authorized when.
If any taxpayer fails to apply for a license or make his return, or if the city clerk-treasurer is dissatisfied with any return, the officer or agent may enter the premises of such taxpayer at any reasonable time and may examine his books and records, and may examine any person under oath administered by him or his agent, touching the matters inquired into, or the officer or agent may fix a time for the investigation of the correctness of the return, and may issue a subpoena to the taxpayer or any person, to attend upon such investigation and there testify under oath administered by such officer or agent, in regard to the matters inquired into, and may by subpoena require him, or any person, to bring with him such books, records and papers as may be necessary for the investigation. (Ord. 2087 § 11, 1983).
5.48.110 Refunds and statements for balance due authorized when.
If the city clerk-treasurer, upon investigation or upon checking returns, finds the fee or tax, or any of them, paid to him, is more than the amount required of the taxpayer, he shall refund the amount overpaid by a warrant on the current expense fund. If the city clerk-treasurer finds that the fee or tax is less than required, he shall send a statement to the taxpayer showing the balance due, and such taxpayer paying less than the required amount shall within 10 days pay the balance due. (Ord. 2087 § 12, 1983).
5.48.120 Liability for license fee or tax payment – Notice required.
If any taxpayer fails to apply for a license, or make his return or to pay the fee or tax therefor, or any part thereof, within three days after the same becomes due, the city clerk-treasurer shall ascertain the amount of the fee or tax and shall notify such taxpayer thereof, who shall be liable therefor in any suit or action by the city for the collection thereof. (Ord. 2087 § 13, 1983).
5.48.130 Unlawful acts designated.
It is unlawful for any person liable to tax or fee hereunder to fail or refuse to make application or return for a license, or to neglect or refuse to pay the fee or tax when due, or for any person to make any false or fraudulent application or return, or any false statement or representation in, or in connection with, any such application or return, or in any manner to hinder or delay the city or any of its officers in carrying out the provisions of this chapter. (Ord. 2087 § 14, 1983).
5.48.140 Disposition of moneys.
All moneys derived by the city from occupations tax or fee as herein assessed shall be placed by the city clerk-treasurer into the current expense fund. (Ord. 2087 § 15, 1983).
5.48.150 Violation – Penalty.
Any person violating or failing to comply with any of the provisions of this chapter shall be deemed guilty of a misdemeanor, and upon conviction thereof, shall be punished by a fine of not to exceed $300.00, or by imprisonment in the city jail for a term not to exceed 90 days, or by both such fine and imprisonment. Each day that business is conducted in violation of this chapter shall be construed as a separate violation, as provided in MVMC 5.48.020. (Ord. 2087 § 17, 1983).
5.48.160 Effective date.
This chapter shall take effect and be in force five days from and after its passage and publication as by law provided, with the monthly tax remittance to commence effective March 1, 1983. (Ord. 2087 § 18, 1983).