LEWES, DE -- In a meeting this week, the Lewes City Council proposed a new 3% local hotel lodging tax and proposed raising the current Gross Receipts Rental Tax for short-term rentals from the current 5% to 6%.
Rick Quill, owner of the Blue Water House Hotel for more than two decades, expressed his opposition to the proposed tax increase.
"To keep on burdening guests with increases and say oh, just pass it on to your guests, I find it inconsiderate," says Quill.
Scott DeKuypers, owner of Hotel Blue, echoed Quill's sentiments, citing increasing costs squeezing margins.
He added, "When you increase the taxes, that ends up going for a bottom line, and I'm not sure government always remembers that."
For comparison, Rehoboth Beach charges hotels, motels, and tourist homes a 3% local lodging tax, with a 7% gross receipts rental tax rate.
Quill and DeKuyper suggested alternative ways for the city to generate revenue, such as adjusting property taxes.
Quill emphasized the need to raise property taxes.
"If you took it as a whole and you shared it equitably across the board, then these shortfalls may be diminished or you can reconcile with them," says Quill.
Lewes City officials announced plans for public hearings before making a decision.