If you thought that Seattle had the highest sales tax rate in the state, well, yeah, you’d be right.
But the city isn’t alone.
Seattle and Mill Creek share the top spot at 9.6 percent.
That’ll soon change. Mill Creek and several other south Snohomish County cities will surpass Seattle this April when a new 0.3 cent sales tax kicks in to pay for improved bus service for Community Transit.
People in Mill Creek will pay a 9.9 percent sales tax. People in Edmonds, Mukilteo, Lynnwood, Mountlake Terrace, Brier and north Bothell will pay 9.8 percent sales tax.
“I knew we were among the highest,” said Mill Creek City Councilman Mike Todd. “I didn’t know we were the highest.”
And it’s inching close to the point where south county residents will pay a dime or more on sales tax for every dollar spent. That could be problematic for future tax measures that call for increasing the sales tax.
“It’s a number, but it’s kind of psychological,” Todd said.
One of those tax measures coming down the turnpike could be Sound Transit 3, which the Sound Transit board is considering placing on the November ballot.
The board is still deciding how much to ask voters for — and what taxes would be included — in the measure that is expected to expand light rail throughout the region and bring it to Everett.
Edmonds Mayor Dave Earling sits on both the Sound Transit and Community Transit boards.
He said that he and Marysville Mayor Jon Nehring voiced concern about asking voters to raise the sales tax 0.3 percent for Community Transit last November.
The Community Transit board eventually voted unanimously to ask for the tax increase and it was approved 51 percent to 49 percent in November.
Earling said he’s a fiscal conservative, and policymakers need to be cautious in asking for any tax increases. But he said it’s easy to see a need.
“These sorts of projects are terribly important,” Earling said. “We do have projections of population increases and a constrained transportation system.”
But will voters shy away from charging themselves a dime or more on sales tax?
“I can’t really tell you what’s the pain threshold but it’s one that a lot of people are thinking about,” Earling said.
There is no upper limit for the amount of sales tax that a community can approve, said Beverly Crichfield, a spokeswoman for the state Department of Revenue. The state takes 6.5 percent of the sales tax. The rest pays for local measures.
Washington has the fourth highest average state and local sales tax rate in the nation behind Arkansas, Tennessee and Louisiana, according to the Washington, D.C.,-based Tax Foundation.
One of the reasons that the state’s sales tax rate is so high is because the state is one of the few that doesn’t charge an income tax, Todd said.
When people gripe about the sales tax, Todd said he reminds them there are plenty of exemptions like on food and rent. He also said that people usually don’t mind paying the sales tax when they can see it going to something tangible.
“What I’ve seen if people feel a connection to something you see locally, they feel OK about that,” Todd said.
He pointed to the reason that Mill Creek is slightly higher than its neighboring cities. In November 2012, Mill Creek voters passed a 0.1 percent increase in the sales tax to pay for public safety. Even though it was during the recession, voters approved the measure 67 percent to 33 percent. He noted that 0.1 percent is just a small amount on each transaction.
“It’s a penny on a $10 purchase,” Todd said. “I kind of go back to would you put a penny in the dish by the cash register for better police services? Most people would.”
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