Florida Tourist Development Tax Reform Debate

Byron Donalds says hotel taxes should be used for infrastructure

In Florida, the debate over how local jurisdictions can spend the Tourist Development Tax (TDT)—commonly referred to as the bed tax or hotel tax—is a major policy issue.

Under current Florida state law, revenue generated from the tourist development tax is strictly earmarked primarily for tourism promotion, marketing, convention center upkeep, and tourism-related facility improvements. However, key conservative lawmakers and state leaders—including U.S. Representative Byron Donalds—have advocated for reforming how these funds are allocated.

Key Arguments & Perspective

• Infrastructure Flexibility: Advocates argue that high tourism strains local roads, public safety, transit, and water infrastructure. Donalds and other state conservatives have supported giving local governments increased flexibility to redirect a portion of TDT revenues toward core public infrastructure and services that support both tourists and permanent residents.
• Property Tax Relief Alignment: Donalds has consistently pushed for broader tax reforms in Florida, including proposals aimed at reducing or eliminating homestead property taxes. Reallocating local revenue streams like hotel taxes to cover infrastructure costs is often framed as a way to reduce reliance on residential property taxes.
• Industry Pushback: The tourism and hospitality industry generally opposes loosening restrictions on hotel taxes, arguing that diverting marketing dollars away from tourism promotion risks hurting visitor volume and local economies long term.