A front page article in The Oregonian yesterday had this headline, “Portland council to consider hotel tax”. The article by Brad Schmidt said that a 2% increase in the hotel tax is under consideration. It will be charged to overnight guests only in hotels with more than 50 rooms. A subcommittee will determine how to better market travel to Portland when the money starts rolling in.
Yes. The money will pay for new tourism advertising. This apparently means that people like me will appreciate come-visit-Portland ads so much that we’ll rush there and pay $2 more for our rooms because of it. Huh? Shouldn’t the people who benefit from tax increases pay for them? I guess the attitude is, soak the visitor who probably is either on an expense account or won’t pay attention to the bill.
When will the extra taxes and fees added to hotel room rates start to keep people from traveling? Is this happening already?
This 2% increase will raise about $6.6 million each year for ads, branding, promotions, and sponsorships, whatever those last 3 mean. It sounds kind of vague to me.
My only experience with Oregon lodging so far this year was one night spent in Eugene. The basic room rate was $76.00 for a not-so-nice motel. Taxes and Service Fees added $16.47 for a total of $92.47. What service fees? Does anyone ever question this?
If I have this right, then, if I stay in a fairly large hotel in Portland after this increase is approved, and it probably will be, I will pay about $175 for a $129 room.
The city of Portland’s current hotel tax is 11.5% according to Portland on Line where Transient Lodging (Hotel/Motel Tax) breaks it down this way: “Of the 11.5 tax collected within the city of Portland, 6% goes to the City of Portland: 5% to the General Fund and 1% to Travel Portland.” Huh? This must be the new math I hear about. When I was in school this would have added up to 12%, not 11.5%.
I checked my own state, Washington, and found that the hotel tax is 2.0% of the sales tax (6.5%). Again, I couldn’t figure this out so I checked what I paid recently in Seattle for a very modest accommodation. The basic room rate was a bargain $75 (very, very cheap for Seattle). Taxes and Service added $21.05 so I paid $96.05. If I had a better room, say $150, the bite would have been $42.10, if my math is correct.
I tried to surf the Internet to find out which US destination had the highest room taxes/ service fees, and what little information was out there was hard to find, confusing, and/or very dated. I quickly came to the conclusion that no one has studied this in depth yet. Not so surprising with so many jurisdictions, changes, etc.
I did find an article by Martha C. White from the June 6, 2011, New York Times Business Day. Martha reported that a one night stay in expensive New York City includes a $2 per room bed tax that is added to other taxes totaling $50 for a $313 room.
According to the article, New York isn’t even number one. Chicago has the highest guest taxes in the country. There, a combination of car, hotel, and restaurant taxes amount to $38.75 per day for the average visitor.
Those commercials about Portland better be pretty sensational since I’m paying for them.