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HB 4095

Relating to the rate of the hotel occupancy tax in certain municipalities and the use of certain revenue from that tax by those municipalities; authorizing an increase in the rate of a tax.

89th Legislature (2025) Introduced by Todd Hunter

HB 4095 authorizes eligible Texas municipalities to raise hotel occupancy tax rates and gain increased discretion over how they spend the resulting revenue.

Referred to Ways & Means
#coastalaffairs&beaches(i0067) #elections--general(i0310) #taxation--hotel #moteloccupancy(i0806)
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Bill Summary · HB 4095

Legislative bill overview

HB 4095 would authorize certain Texas municipalities to increase their hotel occupancy tax rate and provides flexibility in how those municipalities can use the resulting revenue. The bill appears to give local governments expanded authority over tourism-related taxation and spending compared to current state law.

Why is this important

Hotel occupancy taxes are a significant revenue source for municipalities, often funding tourism infrastructure, convention centers, and economic development. Changes to tax rates and revenue usage directly affect both hotel businesses/travelers and local government budgets for public services and tourism promotion.

Potential points of contention

  • Tax burden increase: Hotels and their customers would face higher taxes, potentially affecting competitiveness with neighboring jurisdictions and tourism volumes
  • Revenue allocation ambiguity: The bill's phrase "certain revenue" suggests discretion in spending that may conflict with existing restrictions on hotel tax revenue, which traditionally funds tourism-related expenses
  • Municipal variability: Allowing rate increases for only "certain municipalities" raises questions about which municipalities qualify and whether this creates unfair competitive advantages

Compiled from official sources — confirm details with the bill’s official record.

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