Bill to expand local-option meals, lodging and vehicle excise taxes advances in Revenue Committee hearing

Secretary Gurkowitz testified to the Joint Committee on Revenue in support of the Municipal Empowerment Act, H.56, saying the measure was “a result of listening to our partners at the municipal level” and proposing local-option revenue options and administrative changes to help cities and towns manage budget pressures.

The measure would (1) raise the local lodging tax ceiling from 6% to 7%, (2) raise the local meals tax ceiling from 0.75% to 1%, and (3) create a new local-option surcharge on the motor vehicle excise of up to 5%, with municipalities allowed to dedicate proceeds to a specialized stabilization fund for uses such as transportation. The administration said the motor vehicle option was intended to extend a revenue option to communities without hotels or large restaurants and that, if adopted statewide at the maximum rate, it “would raise approximately $52,000,000” in new revenue.

Administration…