“THE definition of a lodging or transient accommodation is a little bit loose, so what we need is legislation to tighten the definition of who actually should be paying [the hotel occupancy] or transient tax,” Marianas Visitors Authority’s acting Board Chair Gloria Cavanagh said.
She said MVA found out that in a particular market, only 57% of the visitors were staying at hotels that are members of the Hotel Association of the Northern Mariana Islands.
“That means 43% are staying at guest houses, Airbnbs, which may or may not be paying [the Hotel Occupancy Tax or] HOT,” Cavanagh said.
“You have buildings licensed to rent units that are being used as transient accommodations, instead of accommodations that should be paying HOT. That is a huge revenue for CNMI, and a huge loss as far promoting dollars for MVA,” she added.
Cavanagh said an amendment to the HOT law should be passed by the Legislature.
“We do have information that hopefully the Saipan Chamber of Commerce and HANMI can find someone to champion it at the Legislature to make it into law and pass it,” she added.
“43% don’t stay at a HANMI hotel, so that potentially 43% of HOT that is gone or not received,” Cavanagh reiterated.
Public Law 18-1, as amended by P.L. 19-36, imposes a 15% Hotel Occupancy Tax on the amounts charged on transient occupants of hotel rooms.
HOT is separate from the business gross revenue tax and is remitted to the Department of Finance on a monthly basis.
P.L. 19-36 allots 80% of the HOT collection for MVA’s tourism promotion.
Gloria Cavanagh
