2013–2014 BIENNIAL BUDGET - the City of Tukwila

2013-2014 Biennial Budget City of Tukwila, WashingtonSales and Use Tax (RCW 82.14)GENERAL FUND MAJOR REVENUE SOURCESThe City receives sales tax revenue from three sources. The main source of sales tax, $14.6 million in2013 and $15.0 million in 2014, is the City-imposed 0.85% on retail sales. Similar to property tax, the Cityreceives less than 9% of the sales tax generated within Tukwila. The remaining 91% is distributed toother government agencies and supports transit and public facility agencies. The City also receives aportion of the sales tax collected by King County for Criminal Justice. This is a 0.1% voter approvedsales tax in King County and is collected countywide and distributed to all cities on a per capita basis.The third source of sales tax is collected from the sale of brokered natural gas. These three components ofsales and use tax revenue account for 25.7% in 2013 and 27.8% in 2014 of the City’s General Fundrevenue, making sales tax the largest revenue source for the General Fund.Detail of Sales and Use Tax Budget2013 2014Local Retail Sales & Use Tax $14,629,195 $15,010,390Natural Gas Use Tax 289,526 289,526Criminal Justice 380,000 380,000Total Sales and Use Tax $15,298,721 $15,679,916The sales tax rate in the City of Tukwila is the state allowable 9.5% on retail goods, with an additional0.5% tax on food and beverages sold in restaurants, bars and taverns, and 0.3% on car sales to help payfor statewide transportation improvements. The chart below summarizes how the 9.5% tax collected isdivided between various governmental entities.Sales Tax Distribution by Government EntityPercentPercentof TotalWashington State 6.50% 68.42%City of Tukwila 0.85% 8.95%King County 0.35% 3.68%King County Criminal Justice 0.10% 1.05%Regional Transit Authority 0.80% 8.42%King County Public Transportation Benefit Area 0.90% 9.47%Total Sales Tax on $100 of retail goods 9.50% 100.00%From 2006 to 2007, the City’s sales tax collection grew 10%. 2008 was the first year to see a decline insales tax from the previous year (12%). The chart on the next page shows the change in sales tax since2010, along with the budgeted sales tax revenues for the years 2013 - 2014. The City is assuming 1.7%increase in sales tax growth for 2013 over the 2012 budget and 2.5% increase for 2014 over the 2013budget.Page 59