Senators slapped Salt Lake City in the face Monday, giving preliminary approval to a bill that would force the city to rescind its 1 percent sales tax on hotel room rates.
The 1 percent tax brings between $600,000 and $700,000 to the city's general fund each year, and city hotel/motel owners don't like it. If they're going to be taxed they want the money to go toward tourism advertising, to get more people into hotel rooms, owners said.The bill barely passed, 15-12, and may have more trouble in the Senate and in the House.
Support broke out along the lines of city/non-city senators but had a strange twist as well.
Speaking in favor of outlawing the tax was Chip Lacure, convention sales director for Little America Hotel. After voting to remove the tax, Republican senators attended a fund-raising luncheon at Little America.
Senate President Arnold Christensen, R-Sandy, who voted to cut the tax, said Republicans were paying their own way at Little America Monday. But he acknowledged that Little America owners often help Republican Party causes, including donating meals and space for the Senate president's annual dinner and meals and space for the election night extravaganza the Republicans put on in the Little America every two years.
Sen. Rex Black, D-Salt Lake, said, "We should mind our own business. The (Salt Lake City) council is elected to decide taxing matters and we shouldn't tell them what to do."
But Sen. Dix McMullin, R-South Jordan, sponsor of the bill, said the city's 1 percent tax is unfair because it singles out the hotel/motel business and not other city businesses.
The city's tax is being challenged before the Utah Supreme Court and lawmakers should keep out of it until the court rules, said Assistant Salt Lake City Attorney Steven Allred.