Among the nation's top 50 destinations, when not counting sales taxes, Portland, Ore., ranked the worst when it came to the amount of taxes paid for a car rental, hotel room and restaurant meal, according to a new report from the Global Business Travel Association. A visitor there paid $22.86 a day in those travel-related taxes. Portland was followed by Boston, where travelers paid $19.34 a day and Indianapolis where those travel-related taxes totaled $18.10.
Meanwhile, the 10 cities with the lowest travel tax burdens were in California and Florida, with Burbank coming out the cheapest at $1.58 a day.
Travel-related taxes have become a popular way for cash-strapped cities to boost revenue, says Joe Bates, GBTA's vice president of research.
"It was really in the '90s that these taxes sort of became a widely recognized solution for budgetary problems at the city level,'' he says. "Since then we've seen a steady increase in these discriminatory taxes.''
While Portland has the highest level of certain travel-related taxes, it's still cheaper than many other cities because it doesn't have a general sales tax, Bates says. But cities that impose high levies on amenities like hotels and rental cars, in addition to sales taxes, may find companies and meeting planners looking elsewhere.
"Travel and meeting managers ... watch every penny of their travel spend,'' says Kevin Mitchell of the Business Travel Coalition. "Increased taxes can drive business away and cause lost economic activity ... for communities and regional economies.''
Business trekkers may have no choice but to visit some higher tax locales to see important clients, Mitchell says. "However, travel to such cities may be fewer times a year, by fewer employees. And meetings will go to more competitive venues.''
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