NEWBURYPORT — Mayor Donna Holaday is changing her stance on a meals and hotel tax, and asking the councilors to take up the bills and bring them to a vote.
It was last October, under the former session of the City Council, that Ward 4 Councilor Ed Cameron first submitted the bills. They were not acted on by the time that council session ended, and so they were resubmitted for this new term.
The two separate measures would allow Newburyport to implement a meals tax that would have the tax climb from its current 6.25 percent to 7 percent and would increase the city's local room occupancy excise from 4 percent to 6 percent. It would add 75 cents to the cost of a $100 restaurant tab, and $3 to the cost of a $150 hotel room.
The optional meals tax allows cities and towns to use the "local option" and impose an additional .75 percent tax that would go back to the community.
At the time he submitted the bills, Cameron cited state Department of Revenue figures that show estimated annual revenue under the meals tax would be $282,658 and estimated hotel tax revenue with a 2 percent increase would be about $30,000.
The taxes would help diversify the city's revenue stream, Cameron said at the time.
While Holaday was opposed to the increases last fall, saying it was too much to ask of people, she said this week that the climate has changed.
"Until things stabilize, I don't think that we should be imposing additional fees or taxes onto people at this point," Holaday said in October.
Now things have started to "settle down," the mayor said in an interview yesterday.
"The climate at the time was 'no more, we can't afford it,'" Holaday said, adding that she didn't want to see any more taxes or fees when the measure was proposed.
Since then, a number of communities have implemented the local option tax increases with no negative impacts, Holaday said.
The mayor pointed to the increase in revenue it would bring into the city.
"It all helps," she said.
Cameron said this week that the council's Budget and Finance subcommittee will hold a public meeting in July to get input from citizens. The earliest it could go into effect is Oct. 1, the mayor and Cameron said.
"Much of the revenue would be generated by tourists," Cameron wrote in an e-mail yesterday. "When the average tourist visits Newburyport, their dollars support our local businesses and restaurants. Visitors enjoy our historic and natural environment. They leave nothing behind to fix our sidewalks, support our schools, or pay for local services.
"This is hardly a radical notion that will kill Newburyport restaurants. It's a rational move taken by Boston, Brookline, Somerville, Cambridge and many other smaller communities in Massachusetts. And the meals tax is even higher in New Hampshire and Maine."
Yesterday, the mayor said that as with paid parking, she would like to have a portion of the revenue go toward maintaining the downtown.
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