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With Busy Weekend Ahead, Hotels Worry About Tax Increase

Posted: 9:27 AM May 1, 2012
Reporter: Todd Corillo

With Busy Weekend Ahead Hotels Worry About Tax Increase

Hotels in Harrisonburg are gearing up for a busy weekend with graduation at James Madison University, but they are worried about a tax increase that's on the way.

The Harrisonburg City Council voted 4-1 last week to increase the meals and lodging tax to 6.5%.

Jenifer Jackson manages the Comfort Inn Harrisonburg and is worried that move will drive tourist business away from the city.

Jackson says events like graduation bring people specifically to Harrisonburg, but tourists who come to the area for hiking and to enjoy the fall foliage may end up choosing hotels in other cities or counties.

That's because Harrisonburg already has a higher lodging tax than nearby cities like Staunton, Winchester and Waynesboro.

"One of the biggest complaints we get is on the tax rate," Jackson said. "A few years ago people didn't seem so concerned about that but since 2008 people have been more and more concerned. This is especially true when you talk about group tours."

Jackson says those group tours will likely choose to go elsewhere.

"Tour buses and sports teams and the likes that are looking at 30 rooms a pop. They aren't looking at the individual rate on the room. They are looking at just the total with taxes and everything for a package and they are just as likely say go to Staunton then to pay more and come to Harrisonburg," Jackson said.

When combined, Harrisonburg's sales and meals tax will be 11.5%.

Data from the Tax Foundation shows that combined rate would be higher than major tourist cities like Washington, D.C., New York City and Virginia Beach.