Tax News

The Hidden Cost of Travel Taxes: What You Should Know

Share

Who doesn’t love a great family vacation? A bunch of restless kids crammed in a car that’s too small, for way too many hours. Likewise, you get to enjoy moody teenagers that only stop looking at their electronic devices when they have something negative to say about your family vacation and small children who have to go to the bathroom every time you’ve just past the latest rest area. If you’re really lucky you get to stay with relatives that you might not have even known existed until you arrived at their door step; and your best meal while you’re on the road could be the one you packed in the cooler before you left home. Yes, indeed, who doesn’t love a good family vacation?

New Way Of Travel

Of course, there are many different kinds of family vacations and although many families still eat on the go for cheap, use their own family vehicle to get around and stay with relatives at all cost in order to avoid expensive hotel fees, there are a lot of other people who have changed the definition of family vacation. For those who choose a newer approach to the family vacation, that means traveling in style. From airplanes instead of family vehicles, from gourmet restaurants instead of McDonald’s and from the Holiday Inn instead of your great uncle’s basement, traveling can be so much nicer these days. However, there is a downside to this way of travel. It can be a lot more expensive, especially for anyone with a larger family. Plus, if you’re not careful, there are often extra hidden travel taxes that you might not even be aware of.

Travel Expenses Continue to Rise

Americans like to get out and see their country. Traveling is a popular activity at just about any time of year, but it’s especially common during the summer time. But the cost of travel has increased and according to the National Center for Policy Analysis (NCPA), the cost is only going to get higher. Much of the increase is because of the travel taxes that many cities have decided to add onto many common aspects of traveling, such as car rentals and hotel stays. Cities from all over the country have found a good way to add to their revenue without taking more money from their citizens. That means if you travel, you are going to help the city you visit with its bills.

Which Cities Hit You the Hardest?

Of course every city is different so your tax bill for traveling will vary depending on where you travel. As of now, there are 22 states that carry a lodging tax, which can be as low as 3 percent or as high as 13 percent. In addition, 38 states charge a rental car tax. Some cities add as much as 30 percent to your total cost of travel with these additional taxes. Therefore, if you want to avoid a higher travel tax bill, then you should avoid these three cities: Portland, OR, Boston, MA and Indianapolis, IN. They are the top three cities for high travel taxes according to a recent report form the NCPA. Portland adds on about $22 a day on average to those who travel to and stay in the Rose City. Travelers to Boston pay an average of $19 a day in travel taxes and for those planning on visiting Indianapolis they need to be prepared to pay an average of $18 a day in travel taxes. On the flip side, if you want to get away without paying a lot of travel taxes, try Burbank California, which only charges travelers an average of $2 a day in travel taxes.

Taxes Know no Borders

No matter where you travel for vacation, or work, you will pay some travel taxes, which can put a damper on your vacation. Of course, if you really want to avoid those extra taxes you could always load up your family sedan, drive for hours on end and stay in your uncle’s basement to save a few bucks. Just be prepared for the moody teenagers and small children that always seem to have to use the bathroom at the worst possible time.

This post was published on August 25, 2015

Published by