The Georgia Department of Revenue should update its guidance regarding the hotel-motel fee and explore options to identify additional taxpayers required to pay it.
That’s according to a state audit, which also concluded the agency should develop a risk-based audit selection strategy. The House Appropriations Committee requested the review of the state hotel-motel fee.
The state hotel-motel fee first passed in 2015, is a $5 nightly fee levied on the rental of accommodations. While initially limited to stays in hotel and motel rooms, House Bill 317 expanded the fee in 2021 to include more accommodation types, such as cabins and campgrounds.
It also incorporated marketplace innkeepers, businesses that facilitate vacation and short-term rentals of at least $100,000 annually. The Department of Revenue (DOR), the state’s tax administration agency, administers the fee.
Since fiscal year 2016, Georgia has collected $1.6 billion in fee revenue from the hotel-motel fee, averaging $176 million annually. Under state law, these funds must be used for transportation purposes.