Hannah Potes  / Associated Press

A historic yellow stagecoach arrives at the Lake Yellowstone Hotel as the crowd takes photos during the 125th-anniversary celebration of the hotel in 2016. A legislative panel is considering a new 1 percent tax to help fund Wyoming’s tourism promotion efforts. Hannah Potes / Associated Press

Skift Take: It theoretically makes sense to have a one percent tax rise on typical tourist expenses to allow Wyoming to boost its annual destination marketing budget to around $17 million. But the plan will only work if the money is budgeted effectively.

— Sean O’Neill

A legislative panel tasked with finding ways to raise revenue for the cash-strapped state is considering a new tax to pay for Wyoming’s efforts to promote tourism.

The Legislature’s Joint Revenue Committee is drafting a bill that would impose a 1 percent tax on purchases at hotels, restaurants, bars and other leisure and hospitality establishments around the state.

It’s estimated the tax would raise more than $17 million annually.

Most of the money from the tax would fund the state Tourism Office, which promotes Wyoming’s tourist attractions around the world.

The panel will vote next month on whether to submit the proposal to the full Legislature next February.

Advocates of the tax say it would provide a stable revenue stream for tourism promotion and replace the need for the Legislature to fund the agency from state coffers. The office’s current budget is about $12.5 million a year.

“Tourism is an incredibly competitive business, and we believe that Wyoming should stand upon a more competitive footing with a long-range, dedicated funding source like our surrounding states,” said Chris Brown, executive director of both the Wyoming Lodging and Restaurant Association and the Wyoming Travel Industry Coalition.

Brown was among about a half dozen representatives of businesses that benefit from tourist spending who testified Tuesday in favor of the tax.

Brett Moline of the Wyoming Farm Bureau Federation was the only speaker to oppose the tax, saying it would raise costs for business travelers to the state. His organization might have a different opinion of the tax if some of the money was used to promote Wyoming agriculture products, Moline said.

Tourism is the second-largest industry in the state behind mining. The current downturn in the state’s mining industry has choked state tax revenues, prompting the Legislature earlier this year to assign the Revenue Committee the job of looking for alternative means of raising revenue.

Diane Shober, executive director of the state Tourism Office, said the tax would allow her office to increase its annual budget to around $17 million, which is more in line with what the states bordering Wyoming spend on their tourism efforts.

When Wyoming is outspent by its neighbors on tourism promotion, it potentially means lost tourist income, Shober said. “Every time that a traveling consumer, who is planning a vacation, considers Montana, Idaho, Utah, Colorado over Wyoming, that’s a lost customer to us,” she said.

Under the proposed bill draft, any money raised by the tax that exceeds what is needed to fund the Tourism Office would go into the state general fund.

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