Editor’s note: Contributing columnist, Steve Nicklas, expresses his views and insight on various topics in Marketplace column.
Tax increases are about as popular as the roadwork on Highway A1A in Yulee. Or as a log truck creating congestion by driving in the passing lane, or a daily visitor leaving trash on our beach.
However, one recent tax increase is more palatable. And profitable and effective. It is a subtle increase in the so-called “bed tax,” quietly assessed on overnight hotel stays.
User taxes are paid solely by users. As long as the use is non-essential, these taxes are not regressive. They are progressive – and the kind we can use without consternation for county residents.
Bed taxes are sheer innovation. When overnight visitors stay here, they use our roads and beaches and municipal services. In return, they pay for this use through this incremental tax added to their hotel bill. And since most residents feel they pay enough in taxes and fees, it’s nice to have tourists help out.
The slight tax is hardly noticed, since it’s only a fraction of the hotel nightly rate. And you get hit with it when checking out of the hotel, still groggy from staying too late at the Palace Saloon. (Since the Palace is the oldest saloon in Florida, you could pass this off as a historical pursuit.)
We want overnight visitors, more so than the daily variety. The longer visitors stay here, the more they spend within our local economy – for meals at restaurants, for bike or boat or kayak rentals, for goods from our stores.
Local residents also benefit. We would not have this degree of luxuries and amenities if not for the 700,000 tourists who stay here each year. (Think Lake City.) And let’s not forget that the well-healed residents moving here are attracted by these finer elements of life.
The bed-tax increase came by way of a 5-0 vote by county commissioners. For clarification, it is technically known as the “Amelia Island Tourist Development Tax.” Last year alone, the tax generated $5.5 million in revenues for the county.
$1.4 Million More In Revenue
With this increase in the bed-tax rate, another $1.4 million in tax revenues will come our way. This is the first increase in the bed tax in eight years – so it has not been abused. Meanwhile, tourism is one of our biggest industries, and employers.
The Amelia Island Tourist Development Council convincingly justified the tax increase this way: “With an average return on investment of $157 for every marketing dollar spent by Amelia Island, that $1.4 million revenue could result in a return of nearly $220 million to Nassau County’s economy.”
Now, that’s a tax increase that residents can live with, and even enjoy. We’ll take that over road construction or sloppy tourists any day.
Steve Nicklas is a financial advisor and a chartered retirement planning counselor for a regional U.S. firm who lives on Amelia Island. He is also an award-winning columnist. His business columns also appear in several newspapers in North Florida and South Georgia, and on his personal website at SteveNicklasMarketplace.com. He has published a book of his favorite columns from the last 20 years, “All About Money.” The book is available in local stores and on Amazon. He can be reached at 904-753-0236 or at [email protected].