Harger: Seattle small businesses say things are worse than during COVID-19. Nobody in Olympia or City Hall seems to care.
Mar 3, 2026, 5:00 AM
Artwork covers the windows of a closed business in the Ballard neighborhood during the COVID-19 pandemic. (MyNorthwest file photo)
(MyNorthwest file photo)
A survey of Seattle small businesses just came out with numbers bad enough that I want to walk you through them.
A group called Intentionalist talked to 136 independent small businesses across Seattle and the surrounding area. Cafes. Restaurants. Boutiques. Salons. Neighborhood places. The kind that makes a city feel like somewhere worth living.
Two-thirds of them said they’re under more financial stress right now than they were during COVID-19. During the shutdowns. During the year when nobody could go anywhere.
The worst public health crisis in a century, which literally forced their doors shut, was less damaging to these businesses than whatever is happening right now in Seattle.
Seattle small business numbers are worse than they look
Nearly three-quarters of Seattle’s small businesses say foot traffic is down. Almost two-thirds are seeing sales drop. Only about 1 in 8 said customer demand is enough to cover what it costs to stay open.
Half said theft, vandalism, and break-ins are cutting into their bottom line. And most of them can’t get a decent loan right now, even if they wanted one.
To keep the doors open, most are doing what people do when they’re out of options: dipping into personal savings, taking on new debt, cutting staff hours, skipping maintenance. Most are doing several of these things at once. And the customers walking in for coffee have no idea.
I think about the small business owners I see every day. They were already fighting a battle that the big chains never have to fight. No corporate safety net. No national marketing budget. No team of lawyers reviewing their lease. Just them, their staff, their savings, and their neighborhood.
Seattle Mayor Katie Wilson’s tax agenda is heading straight for businesses already on the edge
Seattle Mayor Katie Wilson is two months into her first term. To her credit, she asked city departments last week to look at 5% to 10% budget cuts. That’s worth acknowledging.
But her broader agenda includes proposals that land directly on the businesses least equipped to absorb them.
The JumpStart payroll tax already hits Seattle businesses with a levy on employee compensation. Wilson wants to expand it. The $30 minimum wage she’s pushing would be among the highest in the country, layered on top of businesses that are already cutting staff hours just to survive.
A local capital gains tax would add another 2% on top of the state’s capital gains tax, projected to raise around $30 million for the city. And a vacancy tax would penalize landlords with empty commercial space, which sounds satisfying until you realize it gets passed straight down to tenants in the form of higher rents.
Each of these, taken alone, might be arguable. Stacked together, aimed at businesses where one in eight say they’re already making enough to cover costs, they represent a reckoning that a lot of neighborhood businesses will not survive.
Olympia is piling on with new taxes on Seattle small businesses, too
First, some context on the B&O tax, because it matters here. Washington’s Business and Occupation tax is unlike most business taxes you’ve heard of. Most states tax profits. Washington taxes gross revenue. Every dollar that comes in the door, before you pay your rent, your staff, your suppliers, or your own salary.
A cafe that brings in $500,000 a year but clears $20,000 after expenses pays B&O tax on the full $500,000. There’s no deduction for the cost of doing business. It hits hardest on low-margin businesses, which is exactly what most neighborhood small businesses are.
The state legislature raised the B&O tax rate on service businesses last year. There’s a bill this session that would add a 5 percent payroll tax on businesses with workers earning above $125,000. Another would let counties add their own B&O tax on top of what businesses already pay the city and the state.
Three layers of tax on gross receipts. The big companies have options, lawyers, and lobbyists. The small business owner on your block doesn’t.
The woman who opened the cafe you love, the guy running the bookstore your kids grew up in, they don’t have a Bellevue to relocate to. They have the neighborhood they bet everything on.
Seattle’s small business crisis is not being treated like the emergency it is
Dan Griffin at Fox 13 covered this survey when it came out. But beyond that, it’s been largely met with silence from the people who could actually do something about it.
The big companies have lobbyists. The small ones have a survey that nobody in Olympia or Seattle City Hall seems to be reading.
Nobody is treating this like the emergency it is. And by the time they do, a lot of these businesses will already be gone.
Charlie Harger is the host of “Seattle’s Morning News” on KIRO Newsradio. You can read more of his stories and commentaries here. Follow Charlie on X and email him here.
