Editorial: Proposed lodging tax increase would be a drain on Park City’s tourism industry
As if Mother Nature wasn’t causing enough stress for the Park City tourism industry, the Utah State Legislature is now getting involved.
Sen. Wayne Harper (R-Taylorsville) recently unveiled a bill, S.B. 136, that would, among other things, increase the statewide transient room tax that visitors pay when they book temporary lodging from 0.32 percent to 3 percent. The hike would help pay for major transportation improvements to roads and mass transit throughout the state.
There’s certainly merit to the idea of raising taxes for transportation infrastructure — making visitors pay for it is another issue entirely — but the legislation is troublesome in Park City, where our economy relies on enticing thousands of visitors each year to come and spend money here instead of other mountain destinations. In essence, the transient room tax increase would raise the total sales tax a visitor would pay for lodging within city limits to 15.45 percent and 12.85 percent throughout the rest of Summit County.
If those figures seem high, it’s because they are. They don’t stack up well compared to what people pay in Park City’s biggest resort-town competitors, where total sales tax rates can be as low as between 8 and 11 percent.
It’s a sure bet that many families looking to book ski vacations will notice the difference while price shopping, but more troublesome is the effect the increase would have on the business travel market.
Park City’s tourism industry has funneled significant resources to becoming a more attractive destination for companies hosting conferences or retreats. The efforts have paid dividends, as business travel has become a major — and lucrative — chunk of overall visitation. But while many families may put up with a higher sales tax because they want the experience Park City offers, businesses will be less forgiving.
For businesses, the specific locale of a conference or retreat is less important than the bottom line. And you can bet the hit that would result from such a significant increase to the transient room tax would be enough to make plenty of them ditch Park City in favor of places like Vail and Aspen.
“We’re talking potentially thousands of dollars in what the final bill is to the company,” Bill Malone, president and CEO of the Park City Chamber/Bureau, recently told The Park Record.
Local tourism officials like Malone and executives within the hospitality industry already have begun to sound the alarm on the legislation, which on Monday earned a favorable recommendation from the Senate Transportation, Public Utilities, Energy and Technology Committee. Rank-and-file residents dependent on a thriving tourism sector should also be paying attention and let their legislators know what they think.
It may not be Parkites footing the tax increase if the bill passes. But in the end, the price we’d pay would be plenty costly.
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