OCA Audit Reports

Issued: January 2009

The hotel occupancy tax (HOT) of nine percent is collected on overnight stays costing more than two dollars in hotels, motels, tourist homes, tourist courts, lodging houses, inns, rooming houses, and bed and breakfasts. Currently, there are 175 establishments collecting the tax within Austin’s city limits. Hotel occupancy taxes have been steadily increasing over the past few years and now yield over $45 million in annual revenue. The recipients of these revenues include the Convention Center Department, the Venue Project, the Austin Convention and Visitors Bureau, and the cultural arts program. The process of verifying that local hotels understand and comply with City ordinance and State statute continues with this fifth in a series of hotel occupancy tax audits.

We found Hotel Occupancy Tax liability and compliance issues exist throughout the hotel industry in Austin; we identified $28,336 in HOT tax deficiency from 8 hotels. An average of $3,542 in tax deficiencies per non-compliant hotel was identified. Non-compliance rate was 73%. Tax deficiencies range from $560 to $14,124 among the non-compliant hotels.

Additionally, recommended revisions to the City Hotel Occupancy Tax ordinance made in the previous Hotel Occupancy Tax audit reports are currently under way. These revisions could help the hotel industry in Austin do a better job of collecting and remitting the hotel occupancy tax faster and more efficiently.

Download the entire text of our Hotel Occupancy Tax: Collection and Remittance Assistance Audit Phase V in Adobe Acrobat. You will need Adobe's Acrobat Reader to view these files. Or request a hard copy of this audit report, No. AU09102, by submitting this audit report request form.

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