Rep. Dan Moul, a member of the House Tourism and Recreational Development Committee, who voted for the bill, which passed the House 137-44, said, "It's about time the third party booking agents pay the appropriate tax for room rentals. For too long, they have been remitting tax only on the wholesale rates, not what the taxpayer actually has paid. This will help both the local and state destination marketing organizations, while generating additional revenue for the state." State Senator Rich Alloway was one of six state Senators that voted against the bill, which passed the Senate 43-6.
As part of the legislation, the funds that will result from closing the loophole - estimated at $23.8 million a year - will be dedicated to statewide tourism promotion. A 2015 study conducted by the Pennsylvania Restaurant and Lodging Association (PRLA) found that every dollar invested in tourism marketing returns $3.43 in tax revenue.
Norris Flowers, President of Destination Gettysburg said, "Getting the State Tourism office budget back to a somewhat competitive level with our neighbor states will benefit all Pennsylvania destinations." Over the past 14 years, the state tourism office budget had dropped from $34 million to $4 million a year.
Act 109 also ensures that hotel occupancy tax is assessed on retail price of hotel rooms at both the state and county level, further ensuring fairness in collection and remittance while giving county destination marketing organizations like Destination Gettysburg additional resources for promotion.
Thanks to PRLA for championing this legislation on behalf of the state's hospitality and tourism industries.
For any questions, contact Norris Flowers at firstname.lastname@example.org.