transparency

Municipal Hotel Occupancy Tax Reporting

Revenue and Rate Reporting under Tax Code Section 351.009

Overview

In the early 1970s, the Texas Legislature authorized municipalities to begin collecting the local hotel occupancy tax (HOT). Almost two decades later, the Legislature offered hotel occupancy taxing authority as one of several revenue options to support sports and community venues. The tax may be levied by a city, county or a partnership between the two.

In 2017, the 85th Legislature passed Senate Bill 1221 with the intent of increasing local government transparency while also allowing the public to better understand the state’s patchwork of municipal HOTs. To comply with Tax Code Section 351.009, municipalities that impose certain HOTs now must annually report their tax rates and revenue amounts, including the percentage of revenue allocated for specific uses, from the preceding fiscal year.

To learn more about state and local hotel taxation in Texas, please review the article entitled The Hotel Occupancy Tax: A Short History of a Complex Levy in the June 2016 edition of the Comptroller’s Fiscal Notes publication.

Reporting Requirements

A municipality that imposes a HOT authorized by Tax Code Chapter 351, Subchapter A must report certain information in accordance with either Option 1 or Option 2, as described below.

Option 1
Complete and submit an online reporting form prescribed by the Comptroller.
Option 2
Provide the Comptroller with a direct link to the posted material on the municipality’s website.

The Comptroller’s office will create a form requesting the following required information from municipalities electing to report under Option 1:

  • The percentage rate of the HOT imposed by the municipality under the authority of Tax Code Ch. 351, Subch. A.
  • If applicable, the percentage rate of the sports and community venue tax imposed by the municipality under the authority of Local Government Code Ch. 334, Subch. H.
  • The dollar amount of revenue collected during the preceding fiscal year from the HOT imposed by the municipality under the authority of Tax Code Ch. 351, Subch. A.
  • If applicable, the dollar amount of revenue collected during the preceding fiscal year from the sports and community venue tax imposed by the municipality under the authority of Local Govt. Code Ch. 334, Subch. H.
  • The dollar amount and percentage of the revenue collected from the tax imposed by the municipality, under the authority of Tax Code Ch. 351, Subch. A, and allocated during the municipality’s preceding fiscal year to each of the following non-population-bracketed beneficiaries of revenue [see Sec.351.101(a)(1), (2), (3), (4), (5), and (9)]:
    • Convention or information centers
    • Convention delegates registration
    • Advertising to attract tourists
    • Arts promotion and improvement
    • Historical restoration and preservation projects
    • Signage directing the public to sights and attractions

Note: The online HOT reporting form is currently being developed and will be available no later than Jan. 1, 2018.

Municipalities electing to use Option 2 must provide the Comptroller’s office a direct internet link, through the Comptroller’s online form, where an interested party can easily find the required information described above in a clearly stated format. The Comptroller has developed an optional template that municipalities may use if they elect to report using this second option.

Optional online reporting template (xlsx)

Reporting Deadlines

Municipalities have a 50-day window to report the required information. They must submit all required information no later than February 20 of each reporting year. Starting in 2018, the annual reporting period begins on January 1 and ends on February 20.

Posting Submitted Material

While SB 1221 does not require the Comptroller to post submitted HOT information on its website, this office nonetheless intends to make available all municipal data and direct websites provided to it during the reporting period. Please check back for a downloadable dataset containing the pertinent information.

Frequently Asked Questions

Our city does not impose a HOT. Does the city need to submit a report or provide a link to the information on the city’s website?

No. Only municipalities that impose a HOT under Tax Code Ch. 351, Subch. A must provide the required tax information.

Our city posts its annual budget and other conventional financial statements online. Will these documents satisfy the HOT reporting requirement?

No. Municipalities subject to the reporting requirements of Tax Code Sec. 351.009 must compile the required information. They must provide the pertinent tax revenue information to the Comptroller either in the format specified by the Comptroller or make the report available for public inspection and post it continuously on the municipality’s website, [in accordance with the requirements of Tax Code Sec. 351.009].

For questions regarding the Comptroller’s implementation of SB 1221, please email us at transparency@cpa.texas.gov or call 844-519-5676.