Coleman’s Feedback Friday — Georgia Approves $5 a Room Hotel Fee on Top of Sales Tax

April 24, 2015

By Bob Coleman
Editor, Feedback Friday

Hotel owners’ pocketbooks continue to be a target by state and local municipalities.

Seattle-Tacoma airport hotels must adhere to a $15 minimum wage.

Large Los Angeles hotels are the target of a $15.17 minimum wage.

And now, the state of Georgia is going after their customers with a $5 a night room fee, on top of an 8% sales tax.

Atlanta-based Embassy Bank’s Board is livid.

In a letter to Georgia Governor Deal the board writes,

“As one of the largest SBA lenders in the southeast whose customers include many hotel owners in Georgia, we are writing to express deep concern about the disastrous effects to our state’s hospitality industry if you do not veto or amend the recently-passes Transportation Bill (HB 170).

Of Specific concern is the $5 per night sales tax which will be imposed on every hotel stay in the state effective July 1, 2015:

  • Studies show that about 80% of all hotel room bookings in Georgia each year are by out-of-state residents, with many of these stays being part of conventions that come to Georgia. By adding an extra cost to every night of every hotel stay, our state will discourage groups from choosing Georgia for their meetings. This would be a crippling set-back for an industry that is still recovering from the 2007 recession.
  • The same $5 tax will be charged for a $35 budget hotel room as for a $1,000 luxury suite. Consider that the majority of hotel rooms in Georgia are priced at $75 or less and you understand the unfair hardship of the new tax on travelers of low and limited income.

Georgia’s hospitality industry has an annual economic impact of about $55 billion in sales. It employs almost 60,000 people at about 1,850 lodging properties that together have some 168,00 hotel rooms. You would certainly agree that any measure with a major influence on this important business sector deserves thorough and transparent deliberation.”

SBLC License Update

I can’t believe I forgot about ReadyCap’s acquistion of the CIT license last year. William Zelaya of Newtek offered the correction.

And, this just in.

CEI of Maine just acquired a license last month.

I’ll find out the seller for next week.

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