According to recent study by STR, US hotel revenue reached record levels in 2012, with profit climbing to 24% of total revenue. Unfortunately, despite growing consumer preference for direct bookings… most hotels also saw an increase in their dependency on expensive OTA-driven transactions. This costly channel drags down profitability and frustrates property owners seeking greater ROI on their investments.
Travel remains one of the most heavily taxed activities in the US, even though most cities try hard to encourage visitors and tourism. Travelers don’t vote where they travel, so cash-strapped cities and states continue to tax hotel rooms, rental cars, and airports. Many times the money is used not only to build and run facilities for travelers such as convention centers and airports, but also is used to help finance local coffers to pay for sports stadiums and youth ball fields. In some cities, taxes on visitors even help fund arts facilities and school systems. The impact can be significant – travelers pay taxes that total 57% more than if they just paid the general sales tax.