State And Local Governments Put Tax Squeeze On Travelers

There’s an excellent story in USA Today running down several cases in which local and state governments have raised taxes on travelers to make up budget shortfalls.

Hawaii and Las Vegas have both raised hotel tax rates, despite dreadfully low occupancy rates. And car rental taxes have gone up considerably in some places, most notably in in Milwaukee.

Whether these taxes draw in more income or defeat themselves by discouraging travel remains to be seen. What’s certain is that it’s easier to raise taxes on visitors than on local voters.

Local governments should be aware, however, that these costs do enter into tourists’ calculations.

A few months ago I was considering a trip to Tucson via Phoenix because airfares to Phoenix tend to be lower. But Phoenix also has extraordinarily punitive set of airport car rental taxes and fees. When I looked at the total cost of the car rental, I realized that the various taxes and fees (some for the car rental company but mostly for the government) has increased the price 55 percent above the base rate.

Here are the numbers:

Rental Time Charge           $227.94

APT CONC RECOV FEE (11.1%) $26.22
Customer Facility Charge ($6.00 per day) $36.00
Energy Recovery Fee ($0.45 per day) $2.70
FAC MAINTAIN FEE ($0.93 per day) $5.58
COUNTY STADIUM TAX (3.25%)  $9.70
STATE TAX (10.3%) $30.74
VEHICLE LICENSE FEE (5%) $14.92
Total Estimated Mandatory Charges (USD) $353.80 
 It was the stadium tax that really got to me. I can at least see some argument that a rental car driver should help pay the costs of highway maintenance or safety. But a stadium? Seriously?
I didn’t go to Arizona. I chose another destination, not only because those extra fees pushed the cost to the edge of my budget but because I was annoyed.
Enjoy your stadium.
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