Business
11:32 am
Wed January 25, 2012

Matthes says proposed tax increase could finance regional airport

A proposed tax increase on hotel rooms could help finance improvements to the Columbia Regional Airport, according to Columbia City Manager Mike Matthes.

Speaking on KBIA’s Intersection, Matthes said that the proposed 3% increase in the city’s lodging tax could help finance a terminal expansion project, estimated at $17 million. He says that by focusing on hotels, it could help deflect some of the cost from local residents. 

"Again," Matthes said,  "that’s I think that’s why there’s some interest in the idea of the lodging tax. It’s not completely based on our local ability to pay taxes. It draws revenue from those who visit. 

Some say a tax increase  could hurt business in Columbia: "Increasing the hotel tax at this stage of the game from a 4 to a 7% has many different problems with it," said Michael Kelly, a board member for the Missouri Hotel and Lodging Association.  "One of the problem’s is there is a direct correlation between raising taxes and lowering occupancy. The proposed tax increase will have to go before Columbia voters before going into effect.