State Tourism Taxes

State and local governments generate a significant amount of revenue from taxes imposed on lodging, restaurants, rental cars and entertainment. These taxes are typically referred to as tourism taxes because they are paid in large part by tourists. The U.S. Travel Data Center, a nonprofit travel and tourism research group funded by the industry, reports that in 1994, state and local governments received about $21.4 billion from tourism taxes.

Preliminary 1995 figures are higher, reporting a total of $26.1 billion--up 22 percent. Imposing taxes on ~tourists has become increasingly popular as a revenue generating tool. Currently, every state levies lodging taxes at some level, restaurant taxes are levied in 19 states and the District of Columbia, rental car taxes are levied in 37 states and the District of Columbia, and entertainment taxes are levied in 15 states.