Some small business owners say Lynnwood’s increased employee tax is creating a hardship for them.
This year the fee that businesses pay for each employee went from $15.50 to $85, an increase of almost 600 percent. The new revenue helped fill a $22 million budget hole.
Some small business owners have been telling the City Council lately how the tax hike has been making things difficult for them.
“I used to pay $800; now I’m obligated to pay $6000 overnight,” said Sun Lee, owner of Olympus Spa at 38th Ave. W. and 196th Street SW.
“The business people are not there to pay off the debt that the government has created,” he said. “It is really hard to raise that money because small businesses run by a small margin of profit.”
Susan Torngren owns Pacific Preschool on 67th Avenue West. Her yearly fee went from $250 to $1100.
“I understand the need to increase the revenue for the city,” she told the Council Monday night. “I’d like to let you know that a 566 percent increase in the fees per employee with less than 60 days notice is an extreme hardship on a business as small as mine.”
Torngren was concerned that she wouldn’t have enough time to raise the money before the bill is due in mid-February.
Because of her testimony, the City Council offered some relief. They passed an emergency resolution to allow quarterly payments for business owners who express an economic hardship. The Feb. 15 late fee would also be waived.
“It is a definite economic hardship on a lot of small businesses and had we had a little more foresight and possibly more time I think we could have prevented adding to the stress level of small businesses,” said Council Vice President Kerri Lonergan-Dreke.