Mayor Bill de Blasio has signed an executive order that suspends the city's 5.875% hotel room occupancy tax for the summer to help kickstart the ailing hotel industry, one of the hardest-hit business sectors during the COVID-19 pandemic.
The occupancy tax will be eliminated for all bookings for three months from June 1 through Aug. 31, 2021. It's hoped that waiving the tax for the summer season will motivate hotels to lower rates and drive demand for bookings.
“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," said Mayor de Blasio in a statement after signing the executive order. "We’re ready for them."
Hotel industry leaders said the move provides some instant relief for the city's all-important leisure and hospitality sector, which lost an estimated 257,000 jobs in 2020, according to NY1.
"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.
City officials estimate revenue from the hotel room occupancy tax is down nearly 90% compared to the past fiscal year, with the pandemic and its crippling impact on travel and tourism the clear leading factor.
So how much will not paying the occupancy tax save you on a hotel room? As an example, we looked into booking a room at one of the most famous hotels in Midtown Manhattan, the St. Regis New York. For a sample weekend in June, a deluxe room booked through the hotel's official website costs $922 per night. Removing the 5.875% occupancy tax would save you $54.16 per night.
While that not sound like much for each night individually, on a two-night stay, that comes out to a savings of $108.32.
Let's look at a more budget-friendly accommodation option: the Hyatt Place New York/Midtown-South. For the same weekend in June, a two-night stay at the property costs $350.40 for the room rate only. On top of that, the occupancy tax represents an additional $10.29 each night. In other words, you could be saving $20.59 on your two-night stay.
Put another way: The money you save from the withheld tax could pay for a good meal at a restaurant in the city.
