Businesses in the city will soon see changes on when they can renew their licenses or report taxes.
Renton City Council voted Monday to amend Renton Municipal Codes, now allowing businesses to renew licenses and report taxes on a calendar year basis.
Currently the city has four dates in a year that businesses can renew their licenses or pay their taxes — Jan. 21, April 30, July 31 and Oct. 31.
The city has received complaints from businesses regarding this system. Many businesses submit their tax forms early have had various errors or corrections, and other businesses have completed forms for the wrong reporting period resulting incurring fees.
To remedy the confusion, the city proposed to move to a single due date system, where businesses have to report their taxes and renew their licenses by Jan. 31. This means the reporting period for an entire calendar year will be due Jan. 31 of the succeeding year.
“After having a little business of my own it is a lot easier for a small business guy to know that when it is all due,” said Don Persson, council member and chair of the finance committee. “We think it is going to make it easier for the businesses that we’ve heard from.”
According to Nate Malone, the city will start making the transition starting January 2018.
The financial department is currently drafting letters to send to businesses. The city will also send emails and renewal notices.
With this ordinance, Renton joins the ranks of other cities in the area that already operate in a calendar system, Malone said.
If a business’s first date of operation is after July 1, it will owe a prorated half year license registration fee of $75, as opposed to the full amount of $150.
The ordinance also clarifies a part of the Renton Municipal Code that says a cap placed on taxable gross revenues not exceed $5 billion. Since businesses can report in multiple tax categories, city officials deemed the wording of the ordinance could me misinterpret it to read the provision be a maximum of gross revenue of $5 billion in each category or in total.
The city currently interprets the code to read businesses are required to pay no more than $2.35 million in taxes for any calendar year, regardless of the number of categories the businesses operates in.
The ordinance changes the language of the code to clarify that businesses are required to pay no more than $4.25 million in taxes for any calendar year.
Council members voted 5-0 after the second and final reading of the ordinance Monday. Council member Carol Ann Witschi was not present and was excused at the council meeting.
