Editorial “The hotel tax” states:
“When Luzerne County enacted a 5 percent hotel tax, hoteliers were not pleased. They argued that the levy — the first in Northeast Pennsylvania — would hurt business and drive away visitors.
“They were wrong. That tax was established in 1996. Since then, Luzerne County has used $25 million of that amount to pay off the debt of the Mohegan Sun Arena.”
WATCHDOG: Yes, the tax helped pay for the Arena. But , contrary to the Intell assertion for which we bet they did no research, it was devastating for the profits of the local hotels, of which one of them was built and is managed by a sister entity to NewsLanc.
In the first year after the imposition of the room sales tax, the profits were reduced by approximately the amount of room sales tax paid to the county. So much for shifting the cost to hotel customers! If the hoteliers felt they could raise their prices by 5% without negatively impacting profits, they would do so already.
At least in the Wilkes-Barre area due to the arena location just off of I-81, the majority of the hotels in the region are able to benefit from what small amount of business is generated. This is not the case in Lancaster, where only the Marriott benefits from most Convention Center events. And unlike in Lancaster County, the Luzerne facility enjoys an ice hockey season.
S. Dale High did the smart thing. When he learned that the arena was a go, he acquired a site within a stone’s throw and built a successful Hilton Garden Inn. Perhaps this inspired the Marriott / Convention Center project here in Lancaster.
Placing a tax on those who have no vote and thus no voice like county visitors is a time honored system of raising revenue. I thought taxing someone who is not represented was unconstitutional but apparently not. As the great Massachusetts politician Tip O’Neal used to say, ” Don’t tax you, don’t tax me. Tax the fellow behind the tree.”