Travel agents and tour operators

From the 2024 DOR Tax Exemption Study

82.04.260(5) - Travel agents and tour operators Description Income from businesses providing travel agent or tour operator services is subject to the travel agents/tour operators B&O tax at the following rates: - 0.275% if the prior year annual taxable amount from providing travel agent or tour operator services is $250,000 or less. - 0.9% if the prior year annual taxable amount from providing travel agent or tour operator services is more than $250,000. Without the preferential rate, the income would be subject to the service and other activities B&O tax rate of 1.5% or 1.75%. Purpose Provides a tax preference to travel agents or tour operator services tied to annual taxable amounts. Taxpayer ($ in millions): savings FY 2024 FY 2025 FY 2026 FY 2027 State Taxes $6.390 $6.640 $6.940 $7.280 Local Taxes $0.000 $0.000 $0.000 $0.000 Repeal of Repealing this preferential rate would increase revenues. exemption Potential ($ in millions): revenue gains FY 2024 FY 2025 FY 2026 FY 2027 from full repeal State Taxes $0.000 $6.090 $6.940 $7.280 Local Taxes $0.000 $0.000 $0.000 $0.000 Assumptions - This repeal takes effect July 1, 2024, and impacts 11 months of collections in fiscal year 2025. -