Utility Tax

Utility taxes are levied on the gross operating revenues earned by private utilities from operations within the City of Mercer Island boundaries or on the City’s own utilities (water, sewer and stormwater). Private utilities that the City taxes include electric, natural gas, solid waste, telephone, and cable television.

State law limits the rate of utility tax on telephone, cellular telephone, pager services, and natural gas to 6% unless voters approve a higher rate. Cable TV must not be taxed at a rate substantially different than other utilities. There are no restrictions on the tax rate for water, sewer, stormwater or solid waste. Utility taxes are levied on the gross operating revenues of the utility provider. 

Utility Tax Rates (effective January 1, 2020)​

Utility - Rate (on gross revenue)

Cable - 7%
Telephone - 6%
Cellular Phone - 6%
Natural Gas - 6%
Electric - 6%
Solid Waste - 7%
Stormwater - 8%
Water - 8%
Sewer - 8%

  • Printer-friendly version