City Councilman Lew Fidler is pushing to extend a hotel tax that he helped get approved two years ago to put much needed revenue in city coffers, though the mayor and hotel industry may put up a fight.
Fidler has spoken about the hotel tax at several civic meetings over the past month, informing residents that the tax – which is put on top of the cost of hotel stays in the five boroughs – could expire soon if the City Council doesn’t act fast. Fidler doesn’t just want to extend it, but he also wants to increase the rate.
Fidler is looking for a hotel tax hike from 5.8 percent to 6 percent, amounting to about 60 cents on a $300 hotel bill. The local pol said the tax has already raised $159 million, “not a penny of which is coming from your pocket.” [CORRECTED]
“If we can extend this tax at a time when the mayor is looking for billions in savings, it will generate over that same one-and-a-half year period [that it has currently been in place] another $97 million,” he said. “That to me is the kind of tax that we want.”
The Hotel Association of New York has opposed the tax because they feel it will hurt tourism to the city.
“We feel very strongly that any tax increase would be detrimental to the industry and the city,” said Joseph E. Spinnato, the president of the association, in a New York Times article.
Spinnato’s claim echoes that of Mayor Bloomberg when the bill initially passed, according to Fidler.
“The fact is that when we were first trying to do this, the mayor said, ‘Don’t do this, it’ll kill tourism.’ And the fact of the matter is that at the time this was first done we were third in the country in tourism, and today we’re first,” Fidler said. “Obviously it’s not because we raised the tax, but it’s to show you that the tax did not affect tourism.”
“It would be absolutely insane to let someone else’s money slip through our fingers when we’re looking for every penny we can make,” he added.
UPDATE (11/5/2011): Lew Fidler left a comment with an update on the situation, saying the following:
Thanks for the post but I have corrections…and a major update.
The City has control over only two taxes…the proprty tax…and some small amount of the hotel tax. We were able three years ago to raise the latter by 7/8ths of one percent, maximizing the rate. That increase cost about three dollars a night on the average hotel stay. It was done over the Mayor’s objection. Nonetheless, we did it and since the increased rate has generated close to $160 million in revenue.
I am not seeking to further raise the rate. In fact, we would lack the power to do so. The problem is that the three year old rate increase expires at the end of the month, which would leave an estimated $96 million on the table uncollected.
For great update, the Mayor now agrees with me. On Thursday, I introduced a bill to extend the tax rate ” at the request of the Mayor”, proving that the cowmen and the farmers can at least work together.
Last week, the Mayor personally told me that on the continuation of the rate ” we cannot afford not to.” on this one, we now agree. Great news for City taxpayers.
I expect that with everyone onboard, the bill will move forward quickly.
Lew from Brooklyn
PS When Councilman Oddo saw the bill as Fidler at the request of the Mayor, he asked on the Council floor whether anyone had checked the temperature in hell today…..funny dude!