Township introduces ordinance to add tax to hotel prices.
By: David Pescatore
EAST WINDSOR Visitors to the township soon may be digging in their pockets for a few more pennies to pay for the privilege of spending the night in one of East Windsor’s hotels.
In accordance with a provision in the recently adopted state budget, the township introduced an ordinance on Tuesday that would impose a municipal hotel and motel occupancy tax.
The state plan creates an 8 percent tax on the price of rent in most New Jersey hotels. Until July 1, 2004, the state will tax 7 percent, with the municipality having the option of collecting 1 percent. After July 1, the state will collect 5 percent with the municipality having the option of taxing 3 percent.
"This is a way for municipal governments to obtain revenue," said Mayor Janice S. Mironov. "We have so few ways to do that. We don’t have the options that the state and county do."
The mayor said that the new tax on the township’s 461 hotel rooms could add $100,000 to the township’s coffers in the first year.
"It should be noted that this is a tax on those passing through, and not on the residents of East Windsor," she said.
Mayor Mironov added that this would not put township hotels at a disadvantage because municipalities across the state are adding similar taxes.
Councilman Perry Shapiro said, "There are few things we can use to get revenue. One hundred thousand dollars is really a lot to a town like East Windsor."
"Municipalities have been pushing (for this tax) for years," said Bill Kearns, general counsel to the state League of Municipalities, on Tuesday. "We expect that every municipality in the state with hotels, motels, bed and breakfasts … will implement this tax."
At least some local hoteliers are unhappy with both the state and local government’s decision to enact this new tax.
"This is going to affect our occupancy a lot," said Kishor Patel, owner of the Colonade Motel on Route 130. The new tax will add $3.60 to the Colonade’s average room rate of $45.
"This is going to kill us," said Peter Vora, owner of the Town House Motor Inn on Franklin Street. "And this is on top of 6 percent sales tax. This will absolutely hurt anybody in the hotel business."
Mr. Vora said that he felt helpless to the whims of government taxation.
"It is not in (hotel owners’) hands. We have to just sit and watch the game."
The township ordinance authorizing the new tax will be up for public comment at the council’s Aug. 5 meeting, 8 p.m. at the Municipal Building.
If passed at that meeting, the tax could go into effect as early as Sept. 1.