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Relating to the calculation, collection, and remittance of state
hotel occupancy taxes.
Estimated Two-year Net Impact to General Revenue Related Funds for HB 3579, As
Introduced: a positive impact of $78,000,000 through the biennium ending August 31, 2021
HB 3579 would make various changes to the calculation and collection of hotel occupancy taxes. The bill would specify that costs such as cleaning charges and furniture rental charges are included in the price of the room for the purposes of calculating the hotel occupancy tax. The bill would exempt any telecommunications charges from being subject to the tax if separately itemized.
The bill would require a person who collects payment for rooms or spaces to collect the tax on the behalf of the hotel owner/operator if they are not the same person (such as online booking services).
Lastly, the bill would extend exemption from occupancy tax to persons renting a space for at least 30 consecutive days, similar to the same exemption for rooms.
While we oppose hotel occupancy taxes, this bill does not create a new tax and does not necessarily expand an existing tax. The bill does clarify that a "space" in a hotel is subject to the same tax as a "room". This clarifies the statute since the law already requires a "space" to be subject to the tax. The provision requiring third party booking services to collect and remit the tax would ensure that rooms are treated equally for tax purposes regardless of whether they are booked directly with the hotel or through a third party booking service. For these reasons we remain neutral on HB 3579.