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No Hotel Tax, Hotels Say
June 25th, 2008

Shocking — note: sarcasm — but the city’s hotel lobby is not too keen on raising taxes to restore cuts to the Department of Education.

A proposal to hike the hotel tax to 8 percent from 5 percent is wafting around City Hall — how much support it really has and whether or not it’s even on the negotiating table with the administration is unclear (some council members have never heard of it).

It’s discussed here in today’s Sun — it’s this tax issue and more that’s contributing to a budget impasse between the mayor and the City Council. (They need to agree by Monday — or else)

A quick call to the city’s Hotel Association shows, however, the idea is far from universally accepted.

“The fact of the matter is any increase in the hotel tax jeopardizes the conventioneers coming to New York City,” said Peter Piscitelli, legislative consultant for the Hotel Association of New York City. “The mayors aim is to get 50 million visitors in New York. Youre not going to get that if you raise taxes.”

For weeks, since the release of the executive budget, Mayor Michael Bloomberg has said tourism is keeping lady liberty’s head above the swelling economic tide. Piscitelli says a tax hike on hotels could send her under.

Any increase of more than a percent, said city budget officials, would also need approval from Albany. When the city decreased the hotel tax from 6 percent to 5 percent during the Giuliani administration in 1994, they left a small window open to increase it. Above that 6 percent, though, would need an OK from upstate.

By on June 25, 2008, 4:12 pm
In category: Gotham City | 2 Comments »

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2 Responses to “No Hotel Tax, Hotels Say”

  1. Larry Littlefield Says:
    June 26th, 2008 at 8:49 am

    The argument is not framed correctly. New York City has a sales tax. It is 4%, with additional taxes going to the MTA and the state.

    The purchase of some goods and services is exempted or favored under that tax, with greater (basic food) and lesser (justification). Other goods and services are nailed with a higher penalty rate, with greater (cigarettes) and lesser (hotels) justification.

    The tendency has been for more and more special deals and penalties to accumulate, not only in sales taxes but also in income and property taxes, and for the special deals and penalties to become less and less justifiable by any fair minded standard.

  2. Larry Littlefield Says:
    June 26th, 2008 at 8:50 am

    The lesser justified exemption I meant to write about is clothing sales. It is also the most recent.

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