If enacted, H3028 would modify how room occupancy excise taxes are calculated for rooms rented under the friends and family rate. The excise tax for such rentals would not be a fixed amount but would instead be based solely on the rate determined by the hotel operator. This shift could lead to variances in tax revenue collected from these rentals, depending on how hotel operators decide to price such rates, potentially impacting state revenue from the hotel sector.
Summary
House Bill H3028 aims to amend Chapter 64G of the Massachusetts General Laws to establish a 'friends and family rate' for hotel and motel occupancy. This bill allows hotel operators to rent rooms at a preferential rate to their employees and their friends and family, with the specific rate determined by the operators themselves. The bill seeks to facilitate benefits for employees in the hospitality sector while potentially enhancing the business model of hotel operators by encouraging family visits at lower costs. This could strengthen the familial ties and community relations of employees within the hospitality industry.
Contention
While the bill may offer advantages for hotel employees and their networks, there might be concerns regarding its implications for overall state tax revenue, particularly if a significant number of rooms are rented at lower rates. Critics may argue that offers of reduced rates could be exploited in ways that undercut the usual pricing structure, leading to a loss in excise revenues that are traditionally applied to hotel bookings. Further discussions around this bill are likely to focus on balancing support for employees with the need to maintain adequate tax revenues for local and state government activities.