Georgia $5 Hotel Tax an Unwelcome Surprise

By Matt Swenson, September 8, 2015

By virtue of his position as managing director and meeting planner of the North American Christian Convention, Larry Collins has seen his share of hotel fees. But when the Georgia state legislature passed a $5-per-night surcharge for all hotels and motels in July, Collins had seen enough. Now, when he looks at destinations for his annual summer event, he won’t consider Atlanta—the state’s capital and biggest market, and the city most affected by the tax. 

“I do not want to encourage them after they have added this new fee,” says Collins. “There is no basis to extract more from the patronizing attendee with yet another fee.” Lawmakers and Georgia Gov. Nathan Deal agree to disagree. The funds generated by the move are slated to help improve the state’s roads. Whether that goal will be realized is up for debate. PKF Hospitality Research casts doubt the state will raise the $200 million that’s earmarked because of reactions like those of Collins.

“The cost to my attendee is important to me, as travel costs will negatively impact conference participation by my attendees,” says Collins, who repeatedly says the state didn’t use common sense when adding the fee.

Mark Vaughan, executive vice president and chief sales officer at the Atlanta CVB, knows Collins isn’t alone. “The feedback we’ve had short term has been disturbing,” he says.

Nevertheless, Vaughan remains confident in Atlanta as a good value for meetings. He says it holds as one of the least expensive of the country’s top 25 markets, noting Florida’s resort fees and New York’s high prices as examples of deterrents planners confront elsewhere.

Part of the criticism is that the tax, passed in the final hours of the general session, was unexpected and unwelcomed news for the area’s hospitality industry. “It caught us by surprise,” admits Vaughan. “I don’t think that’s any secret.”

He says the CVB is pushing for revisions to the law, which has also drawn the ire of the Georgia Hotel & Lodging Association. Gov. Deal says he has no plans to repeal the tax. 

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