Occupational License Forms/Business License

Tell Us About Your Business

Business retention is a priority for the City of Paducah. We would love to hear from our local business community as we engage with local business owners.  Please complete the Business Economic Survey. 

Paducah's Business License Tax Structure

The Business License Tax (also called the Occupational License Tax) is outlined in Section 106 Article III of the Paducah Code of Ordinances.  It's projected to generate approximately $4.5 million for Fiscal Year 2023.  The funds are placed in the General Fund, the City's main operating fund. 

There are two basic systems for calculating business tax: gross receipts and net profit.  More than 30 cities in Kentucky operate on a gross receipts system.  The City of Paducah works on a gross receipts system.  However, instead of charging one flat rate, the City places businesses into one of five classifications (see A through E below) with a rate based on profitability.  The structure of the Paducah's Business License Tax with its five rates is unique and has been called a modified net profits system.

 A  0.00045 
 B  0.00075
 C  0.00150
 D  0.00300
 E  0.00450

Benefits and advantages of the City of Paducah's system include

• Best of both worlds.  Paducah has the simplicity of the gross receipts structure.  Plus, Paducah has five rates that address the profitability of a business.
• Simple to administer.  The Business Tax form is two pages.  
• Not Easy to Manipulate.  With a net profit system, it is easier for a company to manipulate the "bottom line".  For example, a large company with offices outside of Paducah could apportion their profits to an office in another city.
• Similar structure to payroll tax.  The payroll tax of 2.0% is based on gross receipts.  You are taxed on your income before your deductions.

Payment Options

In addition to cash and/or check, the City of Paducah accepts credit and debit card payments at City Hall.  This service for in-person and over-the-phone payments (270-444-8513) provides a convenient way to pay for many of Paducah’s fees and charges collected through the Finance Department and Fire Prevention Division in addition to the Engineering and Planning departments.

Services payable by credit or debit card include business licenses, property tax bills, building permits, fines, and liens.  A 2.95 percent service charge will apply on credit and debit card payments.  Payment types include Discover, MasterCard, and Visa.  The City does not charge or retain this service charge.  There is a $2.00 minimum per transaction.

Forms (Business License and Payroll Tax)

If you have a question, contact the Finance Department at 270-444-8513 or send an email to Revenue.  

For businesses that are new to Paducah, please complete the Registration Application for a Business License.