Spike in Hotel Bookings Adds Millions More for Marketing & Promotion

For Immediate Release
March 1, 2017

Contact:  Brian Dries

Spike in Hotel Bookings Adds Millions More for Marketing & Promotion
City Controller’s latest economic report reviews the 25% increase in revenues from the Hotel Tax 

PHILADELPHIA – City Controller Alan Butkovitz today released his latest monthly economic report that indicated Philadelphia’s Hotel Tax has generated $264 million from Fiscal Year 2012 through Fiscal Year 2016, realizing consistent revenue gains each year.

The Hotel Tax, which is an 8.5 percent tax on the price of the room, generated $58.6 million in Fiscal Year 2016. This was $11.6 million, or 25 percent, more than what was collected in Fiscal Year 2012. The total revenue collected by this tax is distributed to the various agencies charged with marketing and promoting the city.

The average annual increase has been about $2.9 million, or 6.25 percent, over the five year period.  A breakdown of the Hotel Tax revenues collected include the following:

Fiscal Year Amount Collected
FY2012 $47,012,109
FY2013 $49,752,015
FY2014  $53,135,732
FY2015 $55,675,807
FY2016 $58,607,588

During the period in review, the fourth quarter of the fiscal year, which includes April, May and June, posted the strongest revenue collections.  The Fiscal Year 2017 tax revenues through January have totaled almost $41 million, which is ahead of collections for the same period in prior years.

The yearly increases in Hotel Tax revenues are consistent with overall hotel performance indicators reported by the industry during this period, including boosts in demand, occupancy and the average room rate. The Revenue per Available Room indicator for occupancy has realized an average annual increase of about five percent.

In addition to reviewing Hotel Tax revenues, the Controller’s economic report indicated that tax revenues for both the City and PICA portions for January totaled $308 million, which is a 16 percent increase compared to last January.  A breakdown of the total revenues included $260 million into the City’s General Fund and $48 million to PICA.