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Analysis Shows Hotels, Employees, Travelers All Benefit From Tax Reform​

WASHINGTON (November 10, 2017) –  As tax reform legislation moves through Congress, a new economic impact study found that tax cuts could generate $131.7 billion in economic activity for hotels and related industries over the next 10 years.

On behalf of the American Hotel & Lodging Association (AHLA), Oxford Economics analyzed the impact of tax policy changes that would result in a tax cut of $1.5 trillion over 10 years, which they believe will cause real GDP growth to accelerate to 3.0% in 2018.

The results show that tax cuts will stimulate the economy and are expected to generate a boost to hotel industry operations, cause additional guest spending at restaurants and stores in the travel destination, and increase hotel capital investment—all benefitting the broader national economy.

“With tax reform moving through Congress and becoming closer to a reality, we are pleased to see the potential for significant financial benefits to the industry, and the U.S. economy,” said Katherine Lugar, president and CEO of AHLA. “From hotel operations, to our industry’s employees, to consumers enjoying their favorite travel destinations, tax reform enables further opportunity for financial growth and prosperity.”

Under this tax cut scenario, consumer and business travel are both expected to increase. Direct hotel guest spending, both onsite and through ancillary spending such as local restaurants, stores, and attractions, would be $57 billion higher over the next five years.

To meet this increased demand, businesses would hire new employees and add more shifts for existing ones, and increase their capital investment. This would generate $22.3 billion in additional wages and salaries for U.S. workers—equivalent to the annual compensation of 94,700 employees for five years. It would also increase state and local tax revenues by $3.9 billion. The total economic impact of this tax scenario is projected to be $131.7 billion.

Lugar praised Congress for its commitment to reforming U.S. tax policy and creating a pro-growth tax environment that will benefit the hotel and lodging industry, its employees, and American consumers.

“It’s particularly critical as three out of every five hotels in industry are made up of small businesses, many independently or family owned. Tax reform will go a long way in benefiting these individuals, as well as their employees and guests,” said Lugar.

“We are pleased Congress has taken the next step toward enacting smart and effective tax reform that will allow businesses, families, and individuals to succeed. AHLA advocates for policies that enable hotels to operate on a level playing field and that empower business growth, competitiveness and entrepreneurism. We look forward to working with Congress and the Administration before the proposal becomes law to ensure that the final details support continued growth for our industry and the broader economy.”

Click here for the full study.

About the American Hotel & Lodging Association

Serving the hospitality industry for more than a century, the American Hotel & Lodging Association (AHLA) is the sole national association representing all segments of the 8 million jobs the U.S. lodging industry supports, including hotel owners, REITs, chains, franchisees, management companies, independent properties, bed and breakfasts, state hotel associations, and industry suppliers. Headquartered in Washington, D.C., AHLA focuses on strategic advocacy, communications support, and educational resources for an industry that advances long-term career opportunities for employees, invests in local communities across the country and hosts more than one billion guests’ stays in American hotels every year. AHLA proudly represents a dynamic hotel industry of more than 54,000 properties that supports $1.1 trillion in U.S. sales and generates nearly $170 billion in taxes to local, state and federal governments. Learn more at www.AHLA.com.

Contact: Jennifer Myers

jmyers@ahla.com / 202-289-3148

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