Federal Alert: Act Now to protect hotel tax revenues
Friday, February 05, 2010
Our partners at NACo have asked FAC to forward to you this important information. Please call Sen. Nelson or Sen. LeMieux today!
ACT NOW TO PROTECT HOTEL TAX REVENUES:
STATE AND LOCAL GOVERNMENTS STAND TO LOSE OVER $8 BILLION A YEAR IF SENATE ACTS TO GIVE PREFERENTIAL TAX TREATMENT TO ONLINE TRAVEL COMPANIES
The U.S. Senate Finance Committee is considering preempting state and local taxing authority over online travel companies (such as Expedia and Travelocity) as part of a proposed jobs bill. Preempting our authority will NOT create jobs. Rather, according to a report prepared by the Center on Budget and Policy Priorities, preemption could cost state and local governments $8.5 billion in annual tax revenues. These funds are often used to promote tourism and pay bond obligations on community projects, such as convention centers and sports arenas. Some communities funnel these revenues into the general fund where they are used for a wide variety of purposes.
You MUST act TODAY to stop this theft of local tax revenues. Contact your Senators TODAY and tell them what these funds mean to your community. Now is not the time to give one industry preferential tax treatment at the expense of cities and counties - and their residents - across the nation.
The proposal will NOT create jobs. Rather, it will cut badly needed funding to local governments, which will result in job losses and service cutbacks.
State and local governments stand to lose upwards of $8.5 billion annually if the proposal is adopted.
Hotel tax funds are used to promote tourism, which brings more visitors - and dollars - to local communities. This benefits a multitude of small business - hotels, restaurants, rental car and cab companies, retail merchants, and more. That why the American Hotel and Lodging Association (which includes Hyatt, Marriott, and Starwood) supports our position.
Preemption will adversely affect bond obligations that are tied to hotel/motel tax revenues.
Whether to impose hotel taxes - and at what rate - is a local decision and Congress should not act to give a $50 billion a year industry special tax treatment at the expense of already strained local government budgets.
No backroom deals! No bill on this issue has ever been introduced in either chamber, no hearings have been held, and no testimony from any local government official has been presented as to the adverse financial effects this proposal would have on local government budgets.
For more information on this issue from NACo, please click here.
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