CAPE MAY – On a night when Cape May City Council had a presentation from the city’s Taxpayers Association, one member of that association, Jules Rauch, used the public comment period to urge council to raise the municipal occupancy tax rate by 50%.
State law allows up to a 3% municipal occupancy tax on accommodations. This tax is in addition to the state occupancy fee and the regular state sales tax.
The funds collected could help defer some of the municipal expense associated with tourists and visitors to the actual users and away from property taxes.
State data, as of Sept. 17, shows that 202 municipalities make use of the optional tax across all 21 counties. Bergen County leads the way, with 28 municipalities electing to impose the municipal occupancy tax.
Cape May County, along with its southern neighbors, Salem and Cumberland counties, remains the only county where two municipalities take advantage of the tax option. In Cape May County, Middle Township applies the full 3% allowable rate, and Cape May uses a 2% rate.
Of the 202 municipalities imposing the municipal occupancy tax, only five use a rate lower than the 3% ceiling.
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