Little Rock A&P Tax Collections Plunge


Little Rock A&P Tax Collections Plunge
(Jess Ardrey)

By now you’ve heard that the Little Rock Convention & Visitors Bureau has cut 39 positions — 35 full time and four part time. A look at the accompanying chart at the end of this article will give you a good idea why.

Revenue from the city’s 2% local option tax on restaurant sales during January-July 2020 is down 13.65% compared with the year-earlier total.

But an even bigger casualty of the pandemic-caused economic downturn has been the hotel industry. In Little Rock, tax collections on hotel and motel sales are down 46.09% in January-July compared with the previous year.

The local option tax, often called an advertising and promotion tax, is the LRCVB’s primary funding source.

Steuart Walton, who leads the Arkansas Economic Recovery Task Force, said last week that restaurant revenue in August was down 35% in the state compared with August 2019.

The National Restaurant Association reported last week that employment at restaurants and bars remains nearly 2.5 million jobs below its pre-coronavirus peak.

And an Aug. 31 report by the American Hotel & Lodging Association titled “Hotel Industry Remains on Brink of Collapse” reported that:

► Four out of 10 hotel employees are still not working.

► About 65% of hotels remain at or below 50% occupancy.

► Consumer travel remains at an all-time low, with only 33% of Americans saying they have traveled overnight for leisure or vacation since March and only 38% saying they are likely to do so by the end of the year.

► The industry’s leading employers, urban hotels, face collapse because of low occupancies. “Jobs at urban hotels are unlikely to return without either a dramatic increase in occupancy — which is unlikely — or additional Congressional action.”

If you’re a praying sort, it couldn’t hurt to keep Arkansas’ hospitality industry in mind.


Little Rock Advertising & Promotion Tax Collections
Revenue from Little Rock’s 2% local option tax on hotel, motel and restaurant gross receipts

HOTELS*

 

2019

2020

Monthly Comp

YTD Change

January

$157,437.72

$169,148.43

7.44%

7.44%

February

$203,316.38

$201,650.86

-0.82%

2.78%

March

$205,289.82

$205,878.40

0.29%

1.88%

April

$283,398.27

$109,661.26

-61.30%

-19.20%

May

$262,312.92

$51,978.97

-80.18%

-33.59%

June

$257,267.35

$67,697.88

-73.69%

-41.12%

July

$287,744.32

$87,156.14

-69.71%

-46.09%


RESTAURANTS / PREPARED FOOD**

 

2019

2020

Monthly Comp

YTD Change

January

$1,058,997.70

$1,063,044.17

0.38%

0.38%

February

$912,363.31

$992,974.64

8.84%

4.29%

March

$907,404.82

$845,634.32

-6.81%

0.80%

April

$1,093,793.78

$737,572.68

-32.57%

-8.39%

May

$1,002,697.12

$655,595.29

-34.62%

-13.68%

June

$1,047,402.27

$863,989.27

-17.51%

-14.34%

July

$1,027,505.89

$928,884.65

-9.60%

-13.65%

*Includes food and lodging
**Food and non-alcoholic beverages
Source: Little Rock Convention & Visitors Bureau