PROVIDENCE, R.I. -- Business was brisk at hotels around Rhode Island in November, leading to "strong growth" in state tax revenues for the month, according to a report released today by the Rhode Island Department of Revenue.
"State hotel tax revenues posted strong growth year-over-year in November providing an additional $281,443 for the Rhode Island Commerce Corporation, which will use the money to execute a state level tourism promotion and business attraction campaign, a high priority of the governor," said Marilyn S. McConaghy, acting director of the Department of Revenue. "In addition, the Aquidneck Island, the South County and the City of Warwick tourism districts showed solid gains on a year-over-year basis in November 2015."
The Rhode Island Department of Revenue released its FY 2016 State 5.0 Percent Hotel Tax Collections Report for November 2015 today. The State 5.0 Percent Hotel Tax Allocation Report, which is issued on a monthly basis, compares the collections from the state's 5.0 percent hotel tax on a year-over-year, and fiscal year-to-date over fiscal year-to-date basis.
The state 5.0 percent hotel tax is collected on the rental of rooms in the state and distributed based on the formula contained in Rhode Island General Law Chapter 44-63.1 entitled "Tourism and Development."
The November 2015 report may include state 5.0 percent hotel tax receipts generated from the expansion of the state hotel tax base to include the reselling of lodging by online travel companies and the unlicensed rental of accommodations via internet platforms and other media.
It should be noted that state hotel tax receipts received from the unlicensed rental of accommodations via internet platforms and other media are divided between the municipality where the rental occurred (25 percent) and the Rhode Island Commerce Corporation (75 percent) only. At this time, the Office of Revenue Analysis is unable to determine the amount collected from each of these state 5.0 percent hotel tax base expansions and thus an unknown amount of receipts from these expansions may be included in this report.
In addition, the FY 2016 state 5.0 percent hotel tax reports reallocate the general fund and the statewide tourism district's shares of the state 5.0 percent hotel tax to the Rhode Island Commerce Corporation. These transfers are reflected in the detail tables of the report.
"FY 2016 year-to-date state hotel tax collections remain strong with growth of 12.9 percent from FY 2015 state hotel tax collections through November of last year," McConaghy said. "The remarkable thing is that the difference between FY 2016 and FY 2015 year-to-date state hotel tax collections through November is greater than the difference between FY 2015 and FY 2014 year-to-date state hotel tax collections for May of FY 2015.
"At this rate, FY 2016 looks likes it will be a record-breaking year."
On a fiscal year-to-date basis, state hotel tax collections have provided over $2.3 million to the Rhode Island Commerce Corporation's tourism promotion and business attraction campaign. In addition, two of the regional tourism districts, Aquidneck Island and South County have received more than $100,000 more, with Aquidneck Island at nearly $200,000 more, in FY 2016 through November than in FY 2015 through November.
Room-rental revenues at the Omni Providence Hotel declined as state hotel taxes attributable to the hotel decreased by 11.8 percent year-over-year. In spite of this percentage decrease, the nominal decline was modest.
The entire report can be found on the Department of Revenue's web site at: http://www.dor.ri.gov/revenue-analysis/2016.php under the State Reports tab. The full report includes the break down by regional tourism district and municipality of state hotel tax collection distributions on a year-over-year and fiscal year-to-date over fiscal year-to-date basis.
Questions or comments on the report should be directed to Paul Grimaldi, Chief of Information and Public Relations by e-mail at paul.grimaldi@revenue.ri.gov or by phone at (401) 574-8766.