Guest Opinion

by Steve Falk

The “Hotel Fairness Initiative” submitted by the Labor Council for San Francisco’s November General Election Ballot should be called the “Hotel Job-Killing Initiative.” This 2 percent hotel occupancy tax increase bringing the tax and fee on hotel rooms to 17.5 percent, will harm the tourism industry — one of our city’s best opportunities for economic recovery — and attempts to help balance the city’s budget shortfall on the backs of hotels and hospitality workers.

In reality, the tax will kill 2,026 jobs annually and eliminate $75.5 million in wages. These numbers are based on national estimates from the American Economics Group and our city’s hotel room sales market share.

Supporters of the tax increase claim that the city needs to find new ways to fund education, Healthy San Francisco and other services. But an added tax on hotel rooms will only discourage travel to San Francisco, hurt our city’s largest industry, and eliminate many of the union jobs the Labor Council seeks to protect. No one comes out ahead.

It’s important to point out that the hotel tax joins four new tax and fee measures recently proposed by the Board of Supervisors. Supervisor David Chiu has proposed a tax on commercial rents. Supervisor Ross Mirkarimi has sponsored legislation increasing the parking tax from 25 percent to 35 percent. Supervisor John Avalos has introduced a real estate transfer tax that would impact all San Francisco properties. Avalos has also proposed a new alcohol fee that could impact every hotel, restaurant and retailer, as well as hundreds of thousands of San Franciscans.

Steve Falk is president and CEO of the San Francisco Chamber of Commerce.