Taxes and Fees in Lakewood


General Information

Fee Schedule

2022 Fee Schedule as adopted by City Council on Nov. 15, 2021 per Resolution 2021-13.

Business & Occupation Tax

The City of Lakewood does not assess a Business and Occupation tax.  The City does require business licenses for doing business in the City. For more information visit the city’s Business License information page.


Sales Tax

The Local Sales and Use Tax Rate of 10.0%.

Effective July 1, 2021, local sales and use tax within Pierce County, except for Tacoma, will increase one-tenth of one percent (.001). The tax will be used for chemical dependency or mental health purposes. This brings the total rate for all agencies to 10.0%.

In November 2016, regional voters approved the Sound Transit 3 (ST3) ballot measure which would expand the regional public transit system. The ST3 sales and use tax rate of 0.50% is effective April 1, 2017, bringing the total sales and use tax rate for Sound Transit to 1.40%.

The City of Lakewood receives 1% of the 10.0% sales tax rate. The breakdown of the 10.0% sales tax rate is as follows:

AgencyRate
City of Lakewood*1.0%
Pierce Transit0.6%
Sound Transit1.4%
Pierce County Juvenile Facilities0.1%
Zoo/Parks0.1%
South Sound 9110.1%
Criminal Justice0.1%
State of Washington6.5%
Pierce County Mental Health and Chemical Dependency0.1%
Total10.0%

*of the 1%, Lakewood receives 0.84% (Pierce County receives 15% of the 1% and the state receives 1% of the 1% leaving 84% (0.84%) to the city).

Each sales tax dollar that is collected in the city is distributed as shown below:


Property Tax

Private property and businesses in Lakewood are levied a property tax which is collected in two installments in April and October of each year. The 2022 property tax rate averages $11.35 per $1,000 of assessed value and may vary based on individual taxing districts (based on the Clover Park School District, the largest in the City of Lakewood).

The Pierce County Assessor’s Office reports the average 2022 residential property tax bill (including schools, state, fire, library, port, city, etc.) in Lakewood totals $5,041. Below is the trend for average residential property tax bill for the last ten years.

The following chart shows how the average residential property tax bill for Lakewood residents compares to other cities in Pierce County.

Source: Pierce County Assessor. Average value of a single family home in Lakewood is $444,181.

Lakewood receives approximately 8.1% of the property taxes paid by Lakewood residents or $0.8108 per $1,000.00 of assessed value. The city’s portion pays for Lakewood’s general operations including police, Public Works and parks services. The remaining 92.8% is distributed between Washington State, Pierce County, the Port of Tacoma, flood control services, emergency medical services, school districts, rural libraries, Sound Transit (ST3) and fire districts.

Levy Rate Per $1,000 Assessed Value:

Taxing District 2022
City of Lakewood$ 0.8108
Emergency Medical Services$ 0.4527
Flood Control$ 0.1002
Pierce County$ 0.8781
Port of Tacoma$ 0.1545
Rural Library$ 0.3915
School District$ 3.4599
Sound Transit$ 0.1841
Washington State$ 2.6586
West Pierce Fire District$ 2.2584
Total Levy Rate$11.3489
Where do my property taxes go?

Utility Tax

Utility taxes are levied on the gross income earned by private utilities from operations within the city of Lakewood boundaries. Taxable utilities include electric, natural gas, cable, cellular, telephone, and solid waste.

State law limits the rate of utility tax on cellular, telephone, and natural gas to 6% unless voters approve a higher rate. There are no restrictions on the tax for solid waste. Cable TV must not be taxed at a rate substantially different than other utilities.

The table below indicates the different utility rates assessed in the city of Lakewood:

UtilityRate
Electric5.0%
Natural Gas5.0%
Cable6.0%
Cellular6.0%
Telephone6.0%
Solid Waste6.0%
Stormwater6.0%

Utility taxes are due by the last day of the month following the end of the monthly period in which the tax is accrued. Payments not remitted to the city of Lakewood by the due date will accrue the following penalties and interest:

  • 1 to 10 days late – 10% penalty;
  • 11 to 20 days late – 15% penalty;
  • 21 to 30 days late – 20% penalty;
  • 31 or more days late – 25% penalty; and
  • Interest will be charged on all taxes due at a rate of 1% per month that said amounts are past due.

Download the Utility Tax Return Form.

Utility Tax Relief Program

The city of Lakewood offers a utility tax relief program to reimburse qualifying low income seniors and disabled persons for their utility tax payments. To qualify a person must be either 62 years of age or older or be permanently disabled, and the person must have an income less that 50% of the median income. Applicants must be a resident of Lakewood and the amount of relief will be prorated on a monthly basis for each month that the customer was a resident. Applicants must apply each year for the program. The maximum relief available is $30 per year ($10 per utility for electric, natural gas and telephone). Applications are due by December 31.

To apply for tax relief, qualified individuals will need to complete the applicable forms:

Utility Tax Reduction Worksheet/Application

For more information and for assistance in completing the forms, please contact the Finance Division at (253) 983-7707.


Gambling Tax

The city of Lakewood assesses gambling tax on gambling operations. The rates are:

ActivityLakewoodMax Amount Authorized Under Washington State Law
Punch Boards3% of gross receipts5% of gross receipts or 10% of net receipts
Pulltabs5% of gross receipts5% of gross receipts or 10% of net receipts
Bingo5% of net receipts5% of net receipts
Raffles5% of net receipts
Amusement Games2% of net receipts2% of net receipts
Card Games11% of gross receipts20% of gross receipts

Charitable or nonprofit organizations, as defined by RCW 9.46.0209, conducting bingo, raffles, amusement games, or gambling within the City of Lakewood shall be exempt from payment of gambling taxes to the city.

Gambling taxes are due in monthly installments and must be remitted, along with the Monthly Gambling Tax Return by the 15th day of the month following the month in which the tax was accrued.

Payments not remitted to the City of Lakewood by the due date will accrue the following penalties and interest:

  • 1 to 10 days late – 10% penalty;
  • 11 to 20 days late – 15% penalty;
  • 21 to 30 days late – 20% penalty;
  • 31 to 60 days late – 25% penalty; and
  • Interest will be charged on all taxes due at a rate of 1% per month that said amounts are past due.

Real Estate Excise Tax

All sales of real estate are taxed at 1.78%, of which the city receives 0.5%, and 1.28% goes towards state funding of K-12 education and public works assistance as defined in RCW 82.45. The Pierce County Treasurer collects the real estate excise tax and places 1% of the tax collected in the County Current Expense Fund to cover the costs of collection. The remaining 99% of real estate excise tax collected by Pierce County is then remitted to the city on a monthly basis. Excise tax collected may be used for the financing of capital projects as defined in RCW 82.46.010(6).

Real estate excise tax is the obligation of the seller of real property and is due and payable immediately at the time of sale. If the tax is not paid within 30 days of the sale, interest will be charged at the maximum rate permitted by law from the time of sale until the date of payment.

For more information on remitting excise tax to Pierce County please visit Pierce County’s website.


Admissions Tax

An admissions tax of 5% is levied and imposed upon every person (including children without regard to age) who pays an admission charge to any place or event including play tickets, entrance fees and cover charges to clubs.

The tax, along with the Admission Tax Return is due to the city from the person or organization collecting the admission fee by the 15th day of the month following the “reporting period” in which the activity occurred.

Reporting periods are two-month blocks of time:

  • January/February – Due March 15th
  • March/April –  Due May 15th
  • May/June – Due July 15th
  • July/August – Due September 15th
  • September/October – Due November 15th
  • November/December – Due January 15th

Hotel/Motel Lodging Tax

There is an excise tax of 7% on the sale of or charge made for the furnishing of lodging by a hotel, rooming house, tourist court, motel, trailer camp and the granting of any similar license to use real property.  The hotel/motel lodging tax generated from the rental of rooms are restricted to be used for the promotion of tourism in the City of Lakewood. The City’s Lodging Tax Advisory Committee makes recommendations to the City Council in regards to how these taxes are to be used.