Buffalo’s hotel industry doesn’t need a new hotel tax

The tax is supposed to help pay for city services, but Brown should rethink that idea because it’s not a smart way to cover the city’s bills.

Brown’s proposed tax could add $10 to a $200-a-night hotel room, on top of the 5 percent occupancy tax already levied by Erie County, which is part of its overall $9 tax. 75%. The 5% is primarily used to fund the Buffalo Convention and Visitors Bureau and promote tourism in Western New York. There is also a 4% tax in New York State.

Adding a occupancy tax would make this tax storm the third highest total bed tax in the United States, at 18.75 percent, above cities like Baltimore, Cleveland and even Chicago. Neighboring competitor Pittsburgh is keeping its bed taxes at a total of 14 percent.

Higher hotel rates discourage visitors from spending time in Buffalo and could result in lost revenue for restaurants, entertainment and retail outlets as well as hotels.

At 13.75%, Buffalo is now 90th in the nation for hotel taxes and needs to stay there in order to remain competitive with other cities competing for tourism and conventions.

Visit Buffalo Niagara President Patrick Kaler also warns that higher lodging costs could prevent film productions from choosing Buffalo.

Fortunately, the city cannot impose this new tax without approval from the New York State Legislature, which seems unlikely; the session is coming to an end, and the bill to provide that approval has no sponsor in the Senate.

In fact, state Sen. Sean Ryan, D-Buffalo, told the News’ Albany correspondent Rob Gavin that it’s not the right time for a new tax and echoed the opinions of many when he declared: “I think the city needs to go back to the drawing board…”

There’s no doubt that Buffalo needs creative revenue solutions. The proposed bed tax would provide $4.2 million, and other sources of speculative revenue in the budget depend on more money from fines and fees, as well as revenue from casinos that have yet to been finalized by the State of New York and the Seneca Indian Nation.

And although the mayor’s proposed 9 percent property tax hike was reduced to 7.5 percent by the Common Council, city spending has not been reduced enough to make up for the loss of revenue – d ‘where the optimistic outlook on royalties and the proposal for a new tax. .

As federal pandemic aid, like the American Rescue Plan, fades into the rearview mirror, many municipalities face higher costs, without any windfalls to help ease the pain. That should mean belt-tightening, not offering revenue streams that could hurt the city’s tourism businesses.

In Gavin’s article, a city spokesperson said Buffalo would “make changes to its budget” if the tax does not become a reality.

Good idea. New York is already a notoriously expensive state. Now is not the time to give visitors another reason to choose other destinations.

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