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The Metropolitan Tucson Convention and Visitors Bureau (MTCVB) proposed a
2% increase in the City's transient occupancy tax rate. By
definition, the transient occupancy tax in Tucson excludes those renting
rooms for more than 30 days.
The City's transient occupancy tax was established at
2% in 1966 and was increased to 4% in 1969. The rate has not been
adjusted since 1969. The $1 per room per night hotel room surcharge was
also established in 1988.
The MTCVB approached the City this past fall with a
recommendation to increase the tax and dedicate a portion of the tax to
the Bureau to enable them to increase their efforts in promoting tourism.
By State law, any increase in the transient occupancy tax made after
April 1, 1990 must be used exclusively by the City for the promotion of
tourism.
Research by the MTCVB and the City show that the City
of Tucson's bed tax rate of 4% plus $1.00 per room per night is below
that of other jurisdictions. See examples below. For comparison purposes,
the City tax that should be compared to the rates listed below is the
total tax a hotel/motel patron would pay, which is currently 9.5%
(consisting of 4% City transient occupancy tax, 5% state sale tax, and
.5% state bed tax) plus $1 per night.
City Transient
Occupancy Tax
San
Diego
10.50%
Portland
11.50%
Denver
13.45%
Austin
15.00%
San
Antonio
16.75%
The 2% increase in the transient occupancy tax rate
will provide approximately $2.3 million in additional revenue in Fiscal
Year 2004, however, due to State law, the City will allocate this to the
MTCVB for the promotion of tourism.
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