Charles Carson
Residents in the Kansas City suburb of Grandview have just voted in favor of levying a 5 percent tax on hotel stays beginning in 2012. The city expects to net about $120,000 annually and plans to spend the increased revenue to attract tourists.

Although the vote has already taken place, Grandview residents should be aware of the potential effects of the tax on the city’s hotel industry.

In the suburbs of Kansas City, people have plenty of options to choose between competing hotels.  Because its neighboring municipalities levy the tax while Grandview does not, Grandview will be forfeiting its own competitive advantage when attracting potential guests.

This hotel tax could potentially lead to less people choosing to stay in Grandview as the city will no longer have its tax advantage.  That in turn could mean less revenue and less business for the city’s hotels.

We’ve previously covered the potential effects of hotel taxes in Jefferson City and Saint Louis County.

About the Author

Charles Carson