New Research: The Rising Price of Hotel Tax Compliance
Summary
A new report highlights the increasing complexity and cost of tax compliance in the lodging industry, including short-term rentals. Hosts are spending significant time on compliance, and many lack confidence in their methods. Consider exploring AI-powered tools to streamline tax processes and free up time for guest experience and growth.
Key Insights
- •Profit margins across the U.S. hotel industry were 4% below 2019 levels in June 2025, signaling continued challenges in an uncertain economic and geopolitical climate.
- •Nearly half of the respondents (44%) from the hotel sector reported that their approach to tax compliance still involves manual or semi-manual processes.
- •40% of hotel operators reported spending between 50 and 100 hours per year solely on trying to achieve and maintain compliance.
Action Items
- ✓Explore and implement the latest methods and technologies, such as AI-powered tools, to streamline and optimize tax compliance.Effort: mediumImpact: high
Tools & Resources
- →Checked In, Taxed Out: The report, “Checked In, Taxed Out: Benchmarking Tax Compliance in the U.S. Lodging Industry” is from Avalara.
Common Mistakes
- ⚠Hotels that continue to rely on manual or outdated methods are sacrificing time, agility, and a critical competitive advantage.
More from Regulations & Compliance
Carson City, Nevada, is refining its short-term rental regulations. City supervisors are currently reviewing and modifying the local ordinance during a retreat. This review aims to address operational aspects, potentially impacting local hosts through new or revised rules, emphasizing compliance.
A 21-unit vacation rental in Dunedin, Florida, has been approved, signaling potential growth in the local short-term rental market. This approval could lead to increased accommodation options for tourists visiting the area. This news could also influence local regulations.
St. Louis aldermen have approved a short-term rental fee, though a legal battle over existing rules continues. This indicates a focus on regulating the STR market within the city. Hosts in St. Louis should be aware of these new fees, which may impact their profitability. Find out how this affects your STR business.
Curated by Learn STR by GoStudioM