Hotel tax collections increase during first five months of FY ’15

PROVIDENCE – State hotel tax collections showed “solid growth” during the first five months of the fiscal year, and “positive growth” year over year, state Director of Revenue Rosemary Booth Gallogly said.
The R.I. Department of Revenue released its fiscal 2015 state 5 percent hotel tax collections report for November, showing an 8.1 percent increase in collections fiscal year to date, to $9.8 million from $9 million during the prior-year period.
The hotel tax is collected on the rental of rooms in the state and distributed between regional tourism districts, municipalities, the state of Rhode Island, Providence Warwick Convention & Visitors Bureau and the R.I. Convention Center Authority based on a formula.
Fiscal year to date, regional tourism districts received the most from the 5 percent hotel tax collection, at $4.1 million, an 8.3 percent increase over the prior-year period; municipalities, which received $2.3 million, had an 8.5 percent increase over the same period in fiscal 2014; the state of Rhode Island, which received $2.1 million, showed a 7.9 percent increase; while the Providence Warwick Convention & Visitors Bureau, which received $1.1 million, had a 7.6 percent increase; and the R.I. Convention Center Authority, which received $144,122, a 0.2 percent increase.
“Fiscal year-to-date state hotel tax collections continue to show solid growth, a reflection perhaps of the strong tourism promotion efforts that are financed by the state hotel tax,” Gallogly said in a statement.
On a fiscal year-to-date basis, state hotel tax collections increased tourism promotion budgets statewide by approximately $400,000 in the first five months of the fiscal year, she said.
She said that the fiscal year-to-date growth in state 5 percent hotel tax revenue through November 2014 “remain significantly above” the fiscal year-to-date rate of growth recorded in November 2013.
Comparing November 2014 with November 2013, hotel tax collections increased 10.9 percent to $1.2 million. The R.I. Convention Center Authority received a 28.8 percent increase in its allocation to $28,715, while regional tourism districts and the Providence Warwick Convention & Visitors Bureau each received 10.6 percent increases, to $461,923 and $151,874, respectively. The state of Rhode Island saw an 11.2 percent increase to $248,536, while municipalities received a 9.5 percent increase in its allocation to $265,111.

“Although state hotel tax collections continued its positive growth on a year-over-year basis in November, the rate of growth ticked down from the October 2014 report. In spite of this seasonal downturn, year-over-year growth for November 2014 far exceeded the year-over-year rate of growth that was posted last fiscal year at this time. This comparison should be taken with a grain of salt given that anomalies in the payment of hotel taxes last year make it difficult to have a meaningful comparison,” Booth said.

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