Montana Legislature

Red Lodge lawmaker proposes change to bed tax

Posted: Mar 22, 2013 9:14 AM by Jamie Leary
Updated: Mar 22, 2013 9:20 AM

Have you ever stopped to look at how much you pay in taxes when you stay at a hotel? In Montana, one senator is hoping to lower that tax and redirect where those funds go.

Senate Bill 385 has the attention of business owners in tourist communities like Big Sky.

In the lodging business, it's called a lodging or bed tax. In Montana, that tax amounts to 7 percent and goes to the state's general fund, the local community and Montana tourism. Now, Senator Jason Priest of Red Lodge is proposing to reduce that tax to 5 percent and redirect those funds to support Montana tourism.

"The portion of that money that goes towards Montana tourism is of tremendous interest to anybody in the tourism industry in Montana," said David O'Connor, owner of Buck's T-4 Lodge in Big Sky.

Business has been booming for O'Connor.

Of course, O'Connor supports the idea of putting money into Montana tourism, but he has questions.

"The hit to the general fund could be in the $20 million to $25 million range, and as Montanans, we question whether this would be the appropriate mechanism to do that," O'Connor said.

O'Conner doesn't think the bill will pass.

The bill is currently in the Senate taxation committee, pending approval.