WKRN, Nashville, Tennessee News, Weather, and Sports |State wants to tax free breakfasts

State wants to tax free breakfasts

NASHVILLE, Tenn. – Tennessee revenue officials are drafting legislation that would tax hotels for the food it gives away in complimentary continental breakfasts.

The meals are offered at hotels, motels and inns throughout the state and, for some, have become a deciding factor on where to spend the night.

In fact, Marie Stainwall told News 2 she and her husband decided to stay at Guesthouse Inn in Music Valley near Opry Mills because the hotel offers a complimentary breakfast.

"When we choose hotels, we like to choose the ones that give complimentary breakfasts because it cuts the cost down," she explained.

Michelle Jameson is the directors of sales at Guesthouse Inn.  She told News 2 she's heard of the proposal and doesn't like it.

"We already have so many taxes" she said. "We have an occupancy tax, a lodging tax and a city tax.  I just really don't want to propose another tax to our guests, especially for a continental breakfast, which is what we offer complimentary.  I just hope it's something that does not go through."

Johnny Walker owns three hotels near Opry Mills.

He said if the proposal is passed by the legislature it will cause hotel rates to increase across the state.

"We spend in our three hotels, I'd say between $90,000 and $100,000 a year on the food for our breakfasts.  You take that and add the 10% to it, and we've go to share that cost somewhere," he said.

Walker said many hotels have no choice but to offer the breakfasts.  Days Inn and Comfort Inn brands both require it.

"There's no way to do without it," he said.  "The traveling public expects it now."

The Tennessee Department of Revenue is drafting the legislation now and says it is part of a larger package of revenue generating taxes.

If passed, the hotel breakfast tax is expected to generate between $1 million and $2 million.

In a statement, Sara Jo Houghland, spokesperson for the Tennessee Department of Revenue, said, "This proposal prevents erosion of our sales tax base because of judicial decisions and sets Tennessee back in line with the majority of states collecting this revenue."