Uniform Standard for Lodging Taxes Exposed

Model Bill Info
Bill Title	Uniform Standard for Lodging Taxes Act
Date Introduced	July 28, 2016
Date Finalized	September 12, 2016
Date Accessed	May 1, 2018
Type	Model Policy
Status	Final
Task Forces	Tax and Fiscal Policy; Communications and Technology
Keywords	Tax Reform

Summary

The Uniform Standard for Lodging Taxes Act repeals local lodging taxes and creates a statewide lodging tax that applies equally to both traditional lodging properties and online rental units. The Act specifies that revenue from the tax shall be sent to the county and city governments that the lodging property is located in for use as specified by current state law. The Act specifies that the tax rate should be equal to the state's sales and use tax rate, or not greater than five percent if the state does not have a sales and use tax.

Uniform Standard for Lodging Taxes Act

Section 1. Definitions

[Appropriately designated section number] of the statutes is created to read:

(1) “Hotel” means any structure or space, or any portion thereof, that:

(a) Is occupied, or intended or designed for occupancy, by transients for dwelling, lodging, or sleeping purposes; and

(b) Accepts on-site reservations for accommodations;

(2) “Hotel operator” means the individual or individuals operating the hotel, whether as owner, lessee or otherwise;

(3) “Local governing body” means the legislative body of a municipal, metropolitan, or county government;

(4) “Department” means the department of revenue;

(5) “Occupancy” means the use or possession, or the right to the use or possession, of any room, lodgings, or accommodations in a hotel or online lodging unit;

(6) “Online lodging marketplace” or “marketplace” means any person or entity that provides a digital platform for compensation, through which a third party offers to rent an online lodging unit to an occupant;

(7) “Online lodging operator” means any person or entity engaged in the business of renting to an occupant any online lodging unit offered through an online lodging marketplace;

(8) “Online lodging transaction” or “transaction” means any transaction in which there is a charge to an occupant by an online lodging operator for the occupancy of any online lodging unit;

(9) “Online lodging unit” or “unit” means any structure, or a portion thereof, used by an online lodging operator to provide room or space that is suitable or intended for occupancy by an occupant for dwelling, sleeping, or lodging purposes, in exchange for a charge to the occupant for the occupancy;

(10) “Person” means any individual, or group of individuals, that occupies the same room or unit;

(11) “Sales price” is the amount received by the Hotel Operator; and

(12) “Transient” means any person who exercises occupancy or is entitled to occupancy of any unit for a period of less than thirty (30) continuous days.

Section 2. Statewide Lodging Tax Created

[Appropriately designated section number] of the statutes is created to read:

(1) There shall be a tax upon the privilege of occupancy in any hotel or online lodging unit by any transient. The tax shall be an amount equal to:

(a) [Insert number] percent ([X]%) of the sales price charged to the occupant by the hotel or online lodging unit operator for occupancy in the hotel or online lodging unit for any county in which the hotel or unit is located; and

(b) [Insert number] percent ([X]%) of the sales price charged to the occupant by the hotel or online lodging unit operator for occupancy in the hotel or online lodging unit for any city in which the hotel or unit is located; or

(c) [Insert number] that is equal to sub. (a) and (b)] percent ([X]%) of the sales price charged to the occupant by the hotel or online lodging operator for occupancy in the hotel or online lodging unit in any county having a metropolitan form of government.

(2) Nothing in this part shall be construed to impose the tax on the separately stated service fee imposed by the online lodging marketplace on an online lodging transaction.

(3) No online lodging operator shall be subject to the taxes imposed by this section with respect to any online lodging transaction for which the online lodging operator has received written notice or documentation from an online lodging marketplace that such marketplace has paid or will pay the taxes imposed by this section on such transactions. Any notice received under this subsection shall be proof sufficient regarding any liability of an online lodging operator for such taxes.

(4) The tax shall be collected and remitted by the hotel operator or online lodging marketplace, and administered by the department, in the same manner as provided by [insert statutory reference to the sales and use tax statutes] with respect to the sales and use tax.

(5) Hotel operators, online lodging operators and online lodging marketplaces that collect the tax pursuant to this part shall be subject to the administration and enforcement provisions set out in [insert statutory reference to the administration and enforcement sections of the sales and use tax statutes].

(6) Taxes collected pursuant to this part shall be distributed on a monthly basis by the department to the applicable local governing body in which the hotel or unit was located and the tax was collected. The department may deduct an administration fee of one and one hundred twenty-five thousandths percent (1.125%) of the collected tax to cover its expenses of administering the collection and distribution of the tax.

(7) The taxes received by the local governing body from the department may be used for purposes authorized by existing law.

Section 3. Local Governing Body Lodging Tax Repealed

• [Insert statutory reference] is repealed. All taxes levied pursuant to the authority granted by this section are null and void upon the effective date of this legislation.

NOTE: This section repeals the local lodging tax authorization statute and makes null and void all lodging taxes imposed by local governing bodies pursuant to the authority granted by the section. This is necessary to enact the statewide lodging tax instead.

NOTE: For purposes of this model policy, it is recommended that the lodging tax rate be equal to the state’s sales and use tax rate or, if the state does not have a sales and use tax, not greater than five percent (5%).

(END)

Adopted by the Task Force on Communications and Technology and the Task Force on Tax and Fiscal Policy at the Annual Meeting, July 28, 2016.

Approved by the ALEC Board of Directors, September 12, 2016.