In 2018, the hotel industry directly generated nearly $40 billion in state and local tax revenue across the country. But due to the COVID-19 travel decline, state and local tax revenue from hotel operations is expected to drop $16.8 billion this year, according to a new report by Oxford Economics released by the American Hotel & Lodging Association.
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Some of the hardest hit states include California (down $1.9 billion), New York (down $ 1.3 billion), Florida (down $ 1.3 billion), Nevada (down $1.1 billion) and Texas (down $940 million). These tax impacts represent the direct tax revenue decrease from the severe drop in hotel occupancy, including occupancy, sales and gaming taxes. These figures do not include the potential, significant, knock-on effects on property taxes supported by hotels (nearly $9 billion).