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

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

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

The the proposed change seeks to raise the occupancy tax by one percent, to 4 percent, and remove the restriction on using the revenue to pay down debt on the Convention Center. Instead, it plans to use the proceeds to promote tourism and tourism development, including repairs to the Knoxville Civic Auditorium and Convention Center, Worlds Fair Park and other tourism-related facilities.

City officials said in fiscal year 2023-2024, the city earned about $6.7 million from the Hotel/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 first and second readings before the rate increases.

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