Local & State Taxes
A state sales tax is levied at the rate of 6% on the purchase or lease price of taxable goods and on utility services. Local sales taxes are not levied in Kentucky.
The Kentucky Constitution requires the state to tax all classes of taxable property, and state statutes allow local jurisdictions to tax only a few classes. All locally taxed property is subject to county taxes and school district taxes (either a county school district or an independent school district). Property located inside city limits may also be subject to city property taxes. Property assessments in Kentucky are at 100% fair cash value. Special local taxing jurisdictions (fire protection districts, watershed districts and sanitation districts) levy taxes within their operating areas (usually a small portion of the community or county).
Click here for general fact sheets on federal, state and local business and personal taxes.
LOCAL TAX RATES
Occupational License Tax
Employers are responsible for withholding an occupational license tax on the gross wages of their employees.
City of Owensboro rate: 1.33% of gross wages
Daviess County rate: .35% of gross wages
Click here for Daviess County Local Property Tax Rates
LOCAL INCENTIVES
City of Owensboro Occupational Tax Abatement - a 1% reduction in total wages for a ten year period as part of the Kentucky Business Investment (KBI) state Incentive.
Daviess County Economic Development Fund - a local fund developed by the Daviess County Fiscal Court to promote job creation and retention. Click here to download an application.
STATE INCENTIVES
Kentucky Business Investment Program (KBI)
Income tax credits and wage assessments to new and existing agribusinesses, regional and national headquarters, manufacturing companies, and non-retail service or technology related companies that locate or expand operations in Kentucky. Click here to find out more.
Kentucky Enterprise Initiative Act (KEIA)
New and expanding service or technology, manufacturing, or tourism attraction projects in Kentucky may qualify for KEIA which provides a refund of Kentucky sales and use tax paid by approved companies for building and construction materials permanently incorporated as an improvement to real property. It is also available for Kentucky sales and use tax refunds for eligible equipment used for research and development and data processing equipment. Click here to find out more.
Kentucky Reinvestment for Existing Business (KRA)
Provides tax credits to an existing Kentucky company engaged in manufacturing and related functions on a permanent basis for a reasonable period of time that will be investing in eligible equipment and related costs of at least $2,500,000. Click here to find out more.
Kentucky Industrial Revitalization Act (KIRA)
Investments in the rehabilitation of manufacturing or coal mining and processing operations that are in imminent danger of permanently closing or that have closed temporarily may qualify for tax credits. An eligible company shall also include one that has closed but resumes mining operations. Eligible entities include manufacturing companies that save or create 25 jobs and coal mining and processing companies that intend to employ a minimum of 500 persons and have a raw production of at least three million tons from the economic revitalization project facility.
Kentucky Small Business Investment Credit (KSBIC)
The KSBIC program is designed to encourage small business growth and job creation by providing a nonrefundable tax credit to eligible businesses hiring one or more eligible individuals and investing at least $5,000 in qualifying equipment or technology. With certain exceptions, most for-profit businesses with 50 or fewer full-time employees are considered eligible for this program. The KSBIC program is limited to allocating a total of $3 million in tax credits per state fiscal year. Click here to find out more.
Other incentives offered by the state can be found on the following website: http://www.thinkkentucky.com/KYEDC/kybizince.aspx
WORKFORCE TRAINING
Bluegrass State Skills Corporation Skills Training Investment Credit
Provides credit against Kentucky income tax to existing businesses that sponsor occupational or skills upgrade training programs for the benefit of their employees.
Bluegrass State Skills Corporation Grant Reimbursement Program
Provides matching grant funds for customized business and industry-specific training programs.
WINS - Through the Kentucky Workforce Investment Network System (KY WINS), KCTCS can provide funding for companies to offset the cost of training employees. Contact the Owensboro Community and Technical College Workforce Solutions, (270) 686-4400.
LOAN PROGRAMS
Additional loan programs are available through these partners:
Community Ventures Corporation
Green River Area Development District
Kenergy Corporation
