Testimony on Tourism, B&B Tax Rate

April 26, 2017

I testified at the Finance, Revenue and Bonding Committee on Senate Bill 1054.

This bill includes proposals to divert revenue to support tourism and free parking at state parks and decrease the occupancy tax rate from 15% to 10% on bed and breakfast hotels.

ROI (return on investment) for every dollar spent is $3. In this supersector are up from 55,000 jobs in 2015 to 159,100 as of December 15, 2016. Jobs in this year are flat so far. This trend is of concern and demonstrates that when government supports this industry, state revenues rise as well as employment in the tourism hospitality sectors rise. Tourism currently generates 20,600 jobs added since the beginning of the recession in 2008 through 2016.

In regards to the bed and breakfast tax, The revenues from this part of the hospitality are small, approximately $900,000. Presently with 15 percent lodging tax, bed and breakfasts are required to separate breakfast, which is included in the room cost, from the room cost.