Mayor Bill de Blasio Wednesday announced that the city will pause its hotel room occupancy tax rate for a three-month period beginning June 1, 2021, in an effort to resurrect the tourism industry, which has been devastated by the coronavirus pandemic.
According to the city, the leisure and hospitality sector lost an estimated 257,000 jobs from March through Dec. 2020. Eliminating the hotel room occupancy tax, the city said, might incentivize hotels to lower room rates, thereby increasing demand and helping to spur on an economic recovery.
“As our COVID rates continue to plummet and we continue to drive a recovery for all of us, tourists will be coming back to New York City in droves. We’re ready for them,” said Mayor Bill de Blasio in statement after signing the executive order. “By eliminating the hotel room occupancy tax for this summer, we’re accelerating our economic recovery, saving jobs and providing relief for one of our hardest-hit industries.”
The hotel occupancy tax rate currently sits at 5.875%
According to the city, revenue from the hotel room occupancy tax is down about 89% when compared to the last fiscal year.
“COVID-19 has devastated the hotel industry. It is critical that we lend a helping hand to help an industry that is very dependent on tourism, and eliminating the hotel room occupancy for the summer season is a good step,” City Council Speaker Corey Johnson said in a statement.
Leaders within the industry echoed Johnson’s approval as well.
"The temporary occupancy tax waiver is a much needed lifeline that is strongly welcomed by the beleaguered hotel industry,” said Vijay Dandapani, President & CEO of the Hotel Association of New York City.