Occupancy Tax (Hotel Tax)

Occupancy tax (or "hotel tax", "transient occupancy tax", "lodging tax") is a tax on temporary lodging — hotels, motels, B&Bs, short-term rentals (Airbnb, VRBO). Rates and structures vary by jurisdiction.

Combined occupancy tax often runs 10-18% in the US: New York City alone is 14.75% + $3.50/night flat fee, Las Vegas is ~13%, Honolulu is ~14.5%. These taxes fund tourism boards, convention centers, and city infrastructure.

On the folio, occupancy tax usually breaks into multiple lines: state hotel tax, county hotel tax, city hotel tax, and sometimes a tourism improvement district fee. Each is calculated separately on the room rate.

Important: occupancy tax is calculated on the room rate, NOT on resort fees or other folio charges. So a $200/night room with a $50 resort fee and 14% occupancy tax = $200 + $50 + ($200 × 0.14) = $278/night.