Covid-19 downturn costing USD17 billion in lodging taxes
The near collapse of the hotel industry over the past few months is badly affecting state and local coffers.
The sharp decline in travel has led to an estimated $17 billion less lodging tax revenues.
That’s the conclusion from a study by Oxford Economics on behalf of the American Hotel & Lodging Association.
Hardest hit are tourism and business travel hotspots California, Florida, New York and Nevada.
"These taxes are a significant source of revenue for schools, public safety departments and other services," said Chip Rogers, chief executive officer of the American Hotel & Lodging Association, which commissioned the research.
"Local government have used hotels as a significant source of revenue and that’s a challenge if hotels aren’t operating fully."
The $17 billion shortfall doesn’t include the extra spending by hotel guests within communities such as shopping and dining, which also generate tax revenues.
The study estimates a financial hole for California’s local authorities at a combined $1.9 billion and $1.3 billion in New York and Florida.
Hotels positively impact every community across the country, creating jobs, investing in communities, and supporting billions of dollars in tax revenue," Rodgers added.
Rodgers says the effect of Covid-19 on hotels has been nine time worse than 9/11.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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