There is excepted and deducted from the total gross income upon which the license fee or tax is computed so much thereof as is derived from the business which the city is prohibited from taxing under the Constitution or laws of the United States or the Constitution or laws of the state of Washington, and any amount paid by the taxpayer to the United States or the state of Washington as excise taxes levied or imposed upon the sale or distribution of property or services.

There shall also be excepted and deducted from the total gross income upon which the tax is computed all bad debts for services incurred, rendered or charged for during the tax year. Debts shall be deemed bad and uncollectible when they have been written off the books of the taxpayer. In the event debts are subsequently collected, the income shall be reported in the return for the quarter in which the debts are collected and at the rate prevailing in the tax year when collected. (Ord. 1205 § 1, 2011; Ord. 129 § 7, 1970).