Travel Industry Association of American Press Release

Date: October 21, 1998
Contact: Cathy Keefe (202) 408-2183

Third TIA Report Shows Most Travel Taxes Do Not Directly Benefit Tourists

WASHINGTON -- Travelers pay more than $71 billion in travel-related taxes in the U.S. but a new report released today by the Travel industry Association of America (TIA) says most travel tax revenue is not spent on programs that directly benefit the travelers who are paying them.

The report, Travel Taxes in America's Top Destinations, itemizes the travel-related taxes paid by travelers in 50 cities in the U.S. The taxes in the report include hotel taxes, restaurant taxes, car rental taxes, fees and surcharges and gasoline taxes.
According to the report this year the top 50 cities will earmark, on average, 36.6% of their hotel tax revenue to tourism-related programs. This is an increase of 4 percentage points over the same figure in 1995. However, it is still less than half of the tax revenue that will be paid by travelers this year.

"In no way are we suggesting that travelers should not pay some local taxes in the cities they visit. In fact, we strongly support the idea of tourists helping to support local law enforcement, recreation, and other important services," said William S. Norman, president and CEO of the Travel Industry Association of America. "Clean, safe cities with vibrant arts and cultural environments can only increase tourism and that is great for our industry. However, the fact is some cities are doing a much better job of dedicating their travel tax revenue toward programs that benefit travelers than others. We think that it is only fair that most of the money should go toward services that benefit the people who are paying them."

In every city surveyed at least some of the money collected through travel taxes goes into the general fund which is most often used for programs that benefit the entire community and not just travelers. Twenty-seven cities commit some of their revenue toward the Convention and Visitors Bureau and 27 dedicate funds to a Convention facility. Eight cities dedicate funds to the state tourism office, 13 to a sports complex and 9 to local arts, history or cultural organizations.

The average hotel tax in the U.S., according to the report, is 12.36%, an increase of 2.7% since 1995. The average restaurant tax is 7.29%, an increase of 0.4% and the average gasoline tax is .44 cents. For car rentals the average off-airport fee (rate) is 7.91%, the average off-airport fee (flat fee) is $2.43. the average per rental surcharge (rate) is 3.17%, the average per rental surcharge (fee) is $6.56 and the average per day surcharge (fee) $1.60.

TIA is the national, non-profit organization representing all components of the $541 billion travel industry. TIA's mission is to represent the whole of the U.S. travel industry to promote and facilitate increased travel to and within the United States.

Travel Industry Association of America
1100 New York Avenue, NW, Suite 450, Washington, DC 20005-3934
202-408-8422, Fax 202-408-1255
 

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