State and local governments charge lodging taxes on the short-term stays at hotels, motels, bed-and-breakfasts, and other lodging accommodations. The rate of lodging taxes across the United States varies at a state, county, and city-level.
Though the name of the tax may vary—lodging tax, transient tax, occupancy tax—the imposition of lodging taxes is a crucial funding source of revenue for a number of state and local governments. For example, average state lodging tax revenue grew at a rate of 2.92% from 2017 to 2018. Tax revenue from lodging comes from ad valorem lodging taxes and excise taxes—normally imposed as a flat dollar amount per night.
To analyze the distribution of lodging tax rates and collections across the United States, the HVS Lodging Tax Report discusses rate and revenue figures for 150 US cities. Using this data, we are able to report on trends in lodging tax policy and revenue. Further, we analyze the taxability of short-term home rentals—such as Airbnb and other services—to see how growth in the short-term home rental market supplements any decline in the lodging market.
Lodging taxes impact more than just visitors to a hotel as lodging taxes can be used for the funding of tourism agencies and public assembly venues such as convention centers across the US. Lodging tax trends are tied to the development of modern cities.
To learn more, the 2019 HVS Lodging Tax Report examines revenue and rate trends across all 50 US states and 150 US cities.