reprinted from:
Carolina Beach adds
room tax
By Sam Scott, Staff Writer On Tuesday, the town became the first to take advantage of a recent state bill allowing the three New Hanover County beach communities to levy an additional 3 percent tax on hotel bills. Kure Beach has decided to not adopt the tax for now, and Wrightsville Beach has yet to review the tax, which is intended to raise money for tourism-related expenses. A similar tax is under consideration in Wilmington to help fund a convention center. With the existing occupancy tax and the 6.5 percent sales tax, taxes on a hotel room in Carolina Beach will total 12.5 percent when it takes effect in February. The estimated $ 375,000 a year it will raise in Carolina Beach will be split between promoting it as a vacation destination and paying for tourism-related expenses. Mayor Ray Rothrock said that the money will help nurture tourism, the town's only industry. It will also be a fair way to pass the bill for services - such as lifeguards and extra police - to the people who benefit from them most, he said. In Kure Beach, the tax is on the back burner due to opposition from many of the town's motel owners who are fearful that it would deter visitors - a suspicion seconded by Robert Vitale, a Carolina Beach rental property owner who was one of two people to speak against the tax at Tuesday's meeting. While he didn't predict an immediate impact on business, he said the number of visitors would drop as people realized the extra cost. He did not have much faith that increased promotions would help. "They just took money out of my pocket," he said. Claude Farrell, an economics professor at the University of North Carolina at Wilmington, said the test would be whether the money was well spent - otherwise he predicted it would hurt business. "Anytime you raise the price, then people are going to buy less of it," Dr. Farrell said. "Unless you offset that by providing something that's worth the higher price, you are going to lose customers." On Monday, Mr. Rothrock said he didn't
think the tax would deter visitors, saying he didn't think many people
making reservations ask about occupancy tax beforehand. |
