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New state act helps counties with collecting hotel tax from third-party vendors

A new state act that went into effect in January is helping counties with collecting the hotel excise tax on rooms and homes rented through third-party vendors in the area.

Last week, the Carbon County Commissioners adopted its rules and regulations for the hotel room rental excise tax establishing an excise tax on the renting of hotel rooms. The regulations also change the wording to include booking agent and operator through which a room is booked, which is consistent with Act 109 of 2018, which took effect Jan. 22.

“Basically we’re closing the loophole where we were losing thousands of dollars with guests,” Commissioners’ Chairman Wayne Nothstein said.

Carbon County Treasurer Ron Sheehan said that through the act, any third-party vendor, including websites such as Airbnb, HomeAway and VRBO, as well as realty management companies, that collects hotel tax on behalf of the owner is also subject to collect state sales tax and the local hotel tax.

He was happy to report that both Airbnb and HomeAway registered with Carbon County two weeks ago.

Sheehan added that this move will most likely result in a boost in the revenue Carbon County sees collected.

Nothstein commended Sheehan’s office’s efforts for identifying third party places that hadn’t registered with the county to collect the tax.

In 2007, Pennsylvania implemented the hotel tax that is collected on homes, hotel and motel rooms and bed-and-breakfasts booked in the state.

That tax is collected for use on tourism promotion within the counties.

Last year, approximately $600,000 was collected in Carbon County through the hotel tax. The money is then remitted to Pocono Mountain Visitors Bureau, which then gives the county 20 percent of the first $500,000 collected through the 3 percent hotel tax, as well as 4 percent for administering and collecting the tax.

The 20 percent then is disbursed through a tourism promotion program overseen by the county chamber.

The state Department of Revenue has guidelines on its website to help booking agents navigate the process of registering and remitting the tax.

For more information on the changes of the hotel occupancy tax, people can visit the Pennsylvania Department of Revenue’s website at https://bit.ly/2Teqn5u.