Bill Caption

Relating to the use of municipal hotel occupancy tax revenue in certain municipalities.

Fiscal Notes

No fiscal implication to the State is anticipated.

Bill Analysis

HB 2199 would allow the City of Carrizo Springs to use revenue from the municipal hotel occupancy tax to fund the the construction, enlarging, equipping, improvement, maintenance, repairing, and operation of an arena used for rodeos, livestock shows, and agricultural expositions to substantially enhance hotel activity and encourage tourism.

Vote Recommendation Notes

Texas Action opposes HB 2199 for violating the principles of limited government and free markets. We generally oppose the creation or expansion of hotel and occupancy taxes. First, funding projects through the hotel and occupancy tax (HOT) offers little transparency—lawmakers have no way to verify whether the disincentive caused by the high cost of the HOT is offset by gains elsewhere in the tourism industry. Second, the tourism and travel industry, like any other private industry, should not rely on taxpayer subsidies in order to flourish.

 We would prefer reducing or eliminating the HOT altogether. The best economic model is one in which regulation is light, sensible, and transparent.