Albert Myles

In an effort to capture the expenditures of the traveling tourists, many states allow cities and counties to levy a special tax on lodging and restaurant sales to support local tourism development. Revenues derived from the tax usually support competing needs such as tourism, parks and recreation, economic development, industrial property acquisition and improvement in the community. City and county officials could only levy the tax after holding a public hearing on the subject.

However, tight budgets and declining government revenues are causing some communities to question whether they can continue this tax. Rising tax burdens reduce disposable incomes and buying power of local citizens and visitors in the community. Government and development officials point out the tax is a way to stimulate local tourism and economic development. Concerns about the economic benefit and payback are fair issues since public officials and decision makers can ill afford to invest resources in activities that produce small returns to the community.

This session will show participants how to help local officials and tourism directors assess the economic benefit of a special tourism tax using revenue data from their State Department of Revenue. The session will use two approaches: growth rates and benefit cost analysis to illustrates the concepts. Participants will learn how to perform basic tourism impact analysis, without using a computer generated economic impact model.