Hawaii legislators have voted to make a temporary 9.25 percent tax on hotel rooms permanent, the Associated Press reported yesterday.
The current tax rate previously was set to expire in 2015. Other proposals called for raising the rate as high as 11.25 percent to raise more revenue for the state, or lowering it to its 2011 level, which was 7.25 percent.
The winning proposal was supported by Gov. Neil Abercrombie as well as the Hawaii Tourism Authority (HTA), which will receive an $11 million annual funding increase — to $82 million — under the new tax policy.
“While we do not support increasing the [hotel tax], we do support keeping the rate at 9.25 percent beyond the current sunset date,” HTA said in a statement this winter, months prior to lawmakers’ vote. “If legislation passes, the HTA will receive 23.5 percent of the [tax], a 3.5 percent increase in the funding level, which would be reinvested into the Hawaiian Islands brand and would allow us to further market, develop and support Hawaii’s tourism economy, which was the original intent of the creation of the [tax].”
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