Maui officials urged to increase resort property tax rates to benefit local economy

During a recent meeting of the Maui County Budget, Finance, and Economic Development Committee, significant concerns were raised regarding the impact of resort operations on local businesses and the community's economy. The discussions highlighted a shift in the traditional narrative that resorts benefit local economies by attracting visitors who spend money in the community.

A key speaker, Autumn Nas, emphasized that many local businesses, including restaurants and activity providers, are feeling the strain as resorts increasingly keep guests on their properties. This trend, she argued, has led to a decline in the revenue that typically flows into the local economy. Instead of supporting local businesses, resorts are developing their own in-house services, such as surf schools and rental companies, which siphon off visitor spending that would otherwise benefit the community.

Nas pointed out that while resorts do contribute to the Transient Accommodations Tax (TAT), the funds do not adequately support Maui County's needs. She urged committee members to reconsider the county's tax structure, particularly advocating for an increase in real property tax (RPT) rates on resorts. She argued that even a modest increase, such as $2 per night per room, would not deter visitors but could significantly enhance funding for local services and infrastructure.

The discussion also touched on the rising costs of hotel accommodations, with average nightly rates doubling from around $400 to $800 in just two years. This increase, coupled with the shift in how resorts operate, underscores the urgency for the county to reassess its financial strategies to ensure that the economic benefits of tourism are more equitably distributed among local residents.

As the committee continues to deliberate on budgetary matters, the implications of these discussions could lead to significant changes in how Maui County approaches taxation and support for local businesses. The call for action reflects a growing recognition that the traditional model of tourism may no longer serve the best interests of the community, prompting a reevaluation of policies to better align visitor spending with local needs.