Chapter 5.06
TRANSIENT OCCUPANCY TAX
Sections:
5.06.020 Imposition of transient occupancy tax.
5.06.030 Duty to collect and make return.
5.06.040 Tax to be paid quarterly.
5.06.050 Penalty, interest and collection procedures.
5.06.060 Limitations of use of tax proceeds.
5.06.010 Definitions.
For purposes of this chapter, the following definitions shall apply, unless the context clearly indicates otherwise:
A. “Guest” or “person” means an individual, corporation, partnership or association paying monetary or other consideration for the use of a sleeping room or rooms in a hotel.
B. “Hotel” means a structure or portion of a structure which is occupied or intended and designed for occupancy by transients for dwelling, lodging or sleeping purposes and includes any hotel, motel, inn, or bed and breakfast.
C. “Occupancy” means the use or possession, or the right to the use or possession of any rooms or portion thereof, in any hotel.
D. “Operator” means the person who is proprietor of the hotel, whether in the capacity of owner, lessee, sublessee, mortgagee in possession, licensee, or any other similar proprietary capacity.
E. “Transient” means a person who occupies or has available for occupancy a suite, room, or rooms in a hotel for not more than 30 consecutive days. Portions of days shall be counted as full days. The day a transient checks out shall not be included in determining the 30-day period if the transient is not charged rent for the day. [Ord. 528 § 4, 1987.]
5.06.020 Imposition of transient occupancy tax.
A. There is hereby levied a tax on hotel room rentals to transients equal to six percent of the room rent, regardless of the number of occupants of such room. This tax shall be applicable to all room rentals to transients, unless the rental is specifically exempted from taxation by constitution or other valid law. Note: The change in tax from $3.00 per day per room to six percent of the room rent will be effective January 1, 2007.
B. Municipal, state and federal governments are exempt from this tax through purchase order or other device obligating the government to pay for the room. Government employees are not exempt from this tax if the room is rented to them individually or they have the ultimate obligation to pay for the room.
C. This tax shall be in addition to the general sales tax of the borough. General sales tax shall not be levied on this transient occupancy tax. Both taxes shall be computed individually on the room rent. [Ord. 779 § 1, 2006; Ord. 623 § 5, 1996; Ord. 528 § 4, 1987.]
5.06.030 Duty to collect and make return.
A. It is the duty of the operator or person furnishing such services to collect the transient occupancy tax from the transient guest and make a return thereof to the borough. All transient occupancy taxes collected or which should have been collected pursuant to this chapter are borough moneys for which the operator is at all times liable to the borough. The operator is also liable for all moneys collected from the transient guest as transient occupancy tax.
B. This tax accrues each day of occupancy and shall be paid by the operator to the borough at the time a tax return covering such date is due, irrespective of when the guests actually pay their bill to the hotel.
C. An operator may not advertise or state to the public or to any guest, directly or indirectly, that the tax or any part of it will be assumed or absorbed by the operator, or that the tax will not be added to the rental or that it will be refunded, nor may an operator absorb or fail to add the tax or any part of it or refund any tax or fail to separately state the tax to the guest.
D. The tax imposed shall be shown on the billing to the guest as a separate and distinct item. Each operator shall account separately and maintain separate monthly summary totals, for both taxable and nontaxable rents and for taxes collected.
E. Any person acquiring an ownership interest in an ongoing business or the accounts receivable of a business, whether by purchase, foreclosure, or otherwise, shall be liable for the payment of transient occupancy taxes, penalties, interest, fees and costs accruing and unpaid to the borough on account of the operation of the business by the former owner, owners or assigns. The borough may continue to make efforts to collect the transient occupancy tax from the person who owned the business at the time the liability was incurred.
F. The liability of a purchaser or other entity for outstanding taxes, penalties, interest, fees and costs accrued and unpaid by the former owner shall be limited to an amount stated in writing by the borough in response to a release of information request. The borough shall have 15 days to respond to the request.
G. The president and any officer, employee or agent of a corporation having control or supervision of or charged with the responsibility of filing transient occupancy tax returns or remitting transient occupancy taxes is personally liable for any unpaid corporate transient occupancy taxes, penalties, interest, fees and costs accruing and unpaid to the borough. Dissolution of, or sale of, or other change in the form of the corporation does not discharge this liability. [Ord. 598 § 4, 1995; Ord. 528 § 4, 1987.]
5.06.040 Tax to be paid quarterly.
A. The tax levied under this chapter shall be due and payable quarterly. Every operator shall make and file with the director of finance, on forms prescribed and furnished by the director of finance, a return setting forth the amount of all rents charged, whether exempt or not, and the amount of tax collected for transient occupancy and such other information as the director of finance may require on such forms. The completed and executed return, together with remittance in full for the total amount of tax due, shall be transmitted to the director of finance on or before the last day of the calendar month following the close of each calendar quarter.
B. Every operator shall file a return even though no tax may be due. This return shall show why no tax is allegedly due, or, if the business has been sold or otherwise transferred, to whom it was transferred, the date it was transferred, and the address and telephone number of the person to whom it was transferred.
C. Every operator, upon cessation of business, shall, on or before the same day of the next month following cessation of business, or on the last day of the month if no corresponding day exists, make a return to the director of finance, on forms provided by him, of the total rents charged and the amount of tax collected or due for transient occupancies, and shall, upon request, make his books and records available for audit. At the time the return is filed, the full amount of the tax collected or due shall be remitted to the director of finance. Returns filed and taxes remitted and actually received by the director of finance on or before the same day of the next month following the cessation of business, or on the last day of the next month if no corresponding day exists, shall be deemed timely filed and remitted; otherwise, the taxes are delinquent and subject to penalties.
D. Proof of Exemption. Returns shall be accompanied by proof, satisfactory to the director of finance, as to claimed exemption, or exceptions from the tax herein imposed. The burden of establishing any tax exemption is upon the claimant. In the absence of such proof, the rentals or occupancies shall be deemed to have been taxable. [Ord. 528 § 4, 1987.]
5.06.050 Penalty, interest and collection procedures.
A. Any operator who fails to file a return when due and remit any tax imposed by this chapter within the time required shall pay penalty and interest in the amounts prescribed for sales tax in WMC 5.08.100.
B. Any tax required to be paid under the provisions of this chapter shall be deemed a debt owed jointly and severally by the transient and the operator and recoverable by the borough in an action brought against the transient, or the operator, or against the transient and operator jointly. Any taxes collected by an operator pursuant to this chapter, which have not been paid to the borough, shall be deemed to be funds held in trust for the account of the borough. Collection of unpaid taxes shall be in the manner prescribed for collection of sales tax in Chapter 5.08 WMC. [Ord. 528 § 4, 1987.]
5.06.060 Limitations of use of tax proceeds.
A. The proceeds of the tax levied under this chapter shall be used only to develop and implement a visitor industry program.
B. The proceeds of the tax levied under this chapter shall be accounted for separately from the general fund and shall be budgeted for in accordance with Charter Section 5-2. In preparing the annual budget for anticipated revenues and estimated expenditures, the borough manager will accept recommendation for the use of proceeds in the ensuing year from any committee, or any subcommittee, appointed by the assembly for that purpose, if such recommendations are submitted in a timely manner. [Ord. 528 § 4, 1987.]