Providence, R.I. --The Rhode Island Department of Revenue today released its FY 2016 State 5.0 Percent Hotel Tax Collections Report for June 2016. 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."
Expansion of the State 5.0 Percent Hotel Tax Base: The June 2016 report includes the state 5.0 percent hotel tax collections generated by the rental of lodging via hosting platforms and by on-line travel companies (room resellers). The state 5.0 percent hotel tax collections from these rentals covers the period of July 1, 2015 through June 30, 2016 inclusive for all municipalities.
Changes in the Distribution of the State 5.0 Percent Hotel Tax Revenues: Rhode Island General Law 42-63.1-3(b) titled "Tourism and Development – Distribution of tax" provides that for state hotel tax returns and payments received after December 31, 2015 the distribution of state hotel tax revenues would follow the new formula enacted into law by the General Assembly in the 2015 session. The state hotel tax revenue from December 2015 through May 2016 hotel room rental activity was received after January 1, 2016 and thus the new formula applies to the FY 2016 December through May revenue collections contained in this report.
In the 2016 Session, the General Assembly changed the state 5.0 percent hotel tax distribution formula to revert back to the formula that was in place prior to January 1, 2016 for returns and payments received after June 30, 2016. The state hotel tax revenue from June 2016 hotel room rental activity was received after June 30, 2016 and thus the new "old" distribution formula applies to the FY 2016 June revenue collections contained in this report.
In general, the formula for the distribution of state hotel tax revenues to the various recipients for returns and payments received is as follows: • Regional tourism districts: Prior to January 1, 2016, 47 percent; After December 31, 2015 and prior to July 1, 2016, 42 percent; After June 30, 2016, 47 percent; • The Convention Authority of Providence and the Warwick Department of Economic Development shares from hotels located in each respective city, except the Omni Providence Hotel: Prior to January 1, 2016, 31 percent; After December 31, 2015 and prior to July 1, 2016, 28 percent; After June 30, 2016, 31 percent; • The Providence Warwick Convention & Visitors Bureau's share from hotels located outside of Providence and Warwick: Prior to January 1, 2016, seven percent; After December 31, 2015 and prior to July 1, 2016, five percent; After June 30, 2016, seven percent; • The Rhode Island Convention Center Authority's share from the Omni Providence Hotel: Prior to January 1, 2016, 30 percent; After December 31, 2015, zero percent; • The Rhode Island Commerce Corporation's share from hotels located outside of Providence and Warwick: Prior to January 1, 2016, 21 percent; After December 31, 2015 and prior to July 1, 2016, 28 percent; After June 30, 2016, 21 percent; • The Rhode Island Commerce Corporation's share from hotels located in Providence and Warwick, except the Omni Providence Hotel: Prior to January 1, 2016, 21 percent; After December 31, 2015 and prior to July 1, 2016, 24 percent; After June 30, 2016, 21 percent; and • The Rhode Island Commerce Corporation's share from the Omni Providence Hotel: Prior to January 1, 2016, 27 percent; After December 31, 2015, 60 percent.
Results of the June 2016 Report: The findings of the June 2016 State 5.0 Percent Hotel Tax Collections Report on a year-over-year basis are: • Year-over-year growth in state hotel tax receipts was 4.4 percent, well below the 7.3 percent year-over-year increase reported in June 2015; o June 2016 state hotel tax collections include $19,501 of receipts from room rentals via hosting platforms and on-line travel companies; • All tourism districts, other than Northern Rhode Island and Block Island received more state 5.0 percent hotel tax collections in June 2016 than in June 2015; o The Aquidneck Island tourism district received $9,166 in increased revenues from the expansion of the state hotel tax base to room resellers and hosting platforms; • Rhode Island Commerce Corporation (RICC) received $11,808 more year-over-year in state hotel tax revenue than was deposited as state general revenues for June 2015; o RICC collected $4,095 more in state hotel taxes from the assessment of the state 5.0 percent hotel tax on room rentals via hosting platforms and by room resellers.
The findings of the June 2016 State 5.0 Percent Hotel Tax Collections Report on a fiscal year-to-date over fiscal year-to-date basis are: • Fiscal year-to-date over fiscal year-to-date growth in state hotel tax receipts was 12.5 percent in June, a slight decrease from the May 2016 report; o Fiscal year-to-date through June 2016 state hotel tax collections include $203,721 of receipts from room rentals via hosting platforms and on-line travel companies; • Rhode Island Commerce Corporation's share of state hotel taxes were $961,755 more on a fiscal year-to-date basis for FY 2016 than the amount deposited as state general revenues for the same period in FY 2015; o RICC collected $72,945 more in state hotel taxes from the assessment of the state 5.0 percent hotel tax on room rentals via hosting platforms and by room resellers. • The regional tourism districts received $637,230 more in state hotel tax collections in FY 2016 through June vs. the same period last year, growth of 8.7 percent; o Expansion of the state 5.0 percent hotel tax base to hosting platforms and room resellers increased state hotel tax collections for the regional tourism districts by $124,528.
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.