Johnson City commissioners want 5 percent ceiling on hotel-motel taxes raised to 8 percent

Johnson City commissioners have unanimously approved a resolution asking area legislators to sponsor a bill in the coming legislative session that would the city to raise its hotel-motel tax from 5 percent to 8 percent, reports the Johnson City Press.

Current state law puts a 5 percent ceiling on such taxes. And last year, a House subcommittee killed all proposals for increasing local hotel-motel taxes after representatives of the Tennessee Hospitality Association contended total taxes on the lodging industry are getting too high – city taxes combined with county taxes and sales taxes.(Note: Previous post HERE.)

The Johnson City-Jonesborough-Washington County Chamber of Commerce and its Convention & Visitors Bureau requested the increase in April. (Apparently not realizing current law includes the 5 percent cap. The increase would have generated between $400,000 and $450,000 a year, according to officials.)

“It’s needed so we can invest in our community,” Commissioner Jenny Brock said Wednesday. “The visitors bureau could do a lot of things with that revenue, and wee as a community need it for potential projects at Freedom Hall, land acquisition, construction of new soccer fields and other projects.”

A 5-percent cap was placed on the tax in 1980, when the General Assembly first passed legislation authorizing Johnson City to levy a 3-percent “privilege tax.” The City Commission voted to increase the tax to 4 percent in 1982 and 5 percent in 1989.