KNOXVILLE, Tenn. (WVLT) – When the Knoxville City Council meets on November 12, they will consider an increase in the hotel and motel tax rate.

A proposal on Tuesday night. agenda is to modify the hotel occupancy tax imposed by the city of Knoxville and its permitted uses.

Currently, hotels and motels within the city limits pay a 3% occupancy tax to people staying there. The money is then used to help make the Convention Center’s debt service payments. This has been in effect since 2000.

He proposed amendment seeks to increase the occupancy tax by one percent, up to 4%, and eliminate the restriction on having to use the revenue to pay off the Convention Center debt. Instead, it seeks to use the revenue to promote tourism and tourism development, including repairs to the Knoxville Civic Auditorium and Convention Center, World’s Fair Park and other tourism-related facilities.

City officials said that in fiscal year 2023-2024, the city earned about $6.7 million from the Hotel and Motel Tax Ordinance. Raising the tax by one percent would have resulted in about $2.2 million more in revenue.

If the amendment is approved, it will take effect on January 1, 2025. However, the proposal must pass its first and second reading before the rate increases.

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