AN ACT relating to transient room tax.

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AN ACT relating to transient room tax. 1
Be it enacted by the General Assembly of the Commonwealth of Kentucky: 2
Section 1. KRS 142.400 is amended to read as follows: 3
(1) As used in KRS 142.400 to 142.408[this section]: 4
(a) "Department" means the Department of Revenue; 5
(b) "Person" has the same meaning as in KRS 91A.345; and 6
(c)[(b)] "Rent" has the same meaning as in KRS 91A.345. 7
(2) A statewide transient room tax shall be imposed at a rate of one percent (1%) of the 8
rent for every occupancy of any suite, room, rooms, cabins, lodgings, campsites, or 9
other accommodations charged by any hotel, motel, inn, tourist camp, tourist cabin, 10
campgrounds, recreational vehicle parks, or other place in which accommodations 11
are regularly furnished to transients for a consideration or by any person that 12
facilitates the rental of the accommodations by brokering, coordinating, or in any 13
other way arranging for the rental of the accommodations for consideration. 14
(3) (a) A surtax shall be imposed in addition to the tax levied in subsection (2) of 15
this section at the rate of one percent (1%) of the rent cha rged by any 16
person who facilitates the rental of the accommodation by brokering, 17
coordinating, or in any other way arranging for the rental of the 18
accommodation for consideration, and that person is responsible for 19
collecting and remitting the surtax imposed under this subsection. 20
(b) The surtax shall not be imposed on the rental of accommodations charged 21
by any hotel, motel, inn, tourist camp, tourist cabin, campground, or 22
recreational vehicle park. 23
(c) All tax receipts from the surtax imposed under this s ubsection shall be 24
deposited in the affordable housing trust fund established in KRS 198A.710 25
to provide additional resources to fund the activities outlined in KRS 26
198A.715. 27
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(4)[(3)] As used in this section[subsection], rent shall not include any other lo cal or 1
state taxes paid by the person or entity renting the accommodations. 2
(5)[(4)] The tax imposed by subsection (2)[(1)] of this section and the surtax imposed 3
by subsection (3) of this section shall not apply to rentals[rooms, lodgings, 4
campsites, or accommodations supplied] for a continuous period of thirty (30) days 5
or more to a person. 6
Section 2. KRS 142.402 is amended to read as follows: 7
(1) On or before the twentieth day of every month, a taxpayer subject to any[the] tax 8
set forth[provided] in KRS 142.400 shall submit a return and any[the] tax due for 9
the preceding month to the department [ of Revenue] , in a form prescribed by the 10
department. To facilitate administration, the department may permit or require 11
returns or tax payments for other periods. Upon written request received on or 12
before the due date, the department may extend the filing or tax payment due date 13
up to thirty (30) days. 14
(2) The department [ of Revenue] shall examine and audit each return as soon a s 15
practicable after it is received. If the tax computed by the department is greater than 16
the tax paid by the taxpayer, the department shall assess the excess within four (4) 17
years from the filing deadline, including any extensions granted. If the taxpayer 18
failed to file a return or filed a fraudulent return, then the excess may be assessed at 19
any time. 20
(3) A taxpayer may request a refund or credit for any overpayment of tax under KRS 21
142.400 within four (4) years after the tax due date, including any exten sions 22
granted. The request shall be made to the department [ of Revenue] in writing and 23
shall state the amount requested, the applicable period, the basis for the request, and 24
any other information the department reasonably requires. 25
(4) Any tax not paid on or before its due date shall bear interest at the tax interest rate 26
provided in KRS 131.183 from the date due until the date of payment. If an 27
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extension is granted, and the tax is not paid within the extension period, then 1
interest shall accrue from the original due date. 2
Section 3. KRS 142.404 is amended to read as follows: 3
Notwithstanding any other provision of law to the contrary, the president, vice president, 4
secretary, treasurer, manager, partner, or any other pers on holding any equivalent office 5
or position in any corporation, limited liability company, limited liability partnership, or 6
limited liability limited partnership subject to KRS 142.400 and 142.402 shall be 7
personally and individually liable, both jointly and severally, for the tax imposed under 8
KRS 142.400. Dissolution, withdrawal of the corporation, limited liability company, 9
limited liability partnership, or limited liability limited partnership from the state, or the 10
cessation of holding any office sha ll not discharge the liability of any person. The 11
liability shall attach at the time the tax or surtax becomes or became due. No person shall 12
be held liable under this section if the person did not have authority to collect, truthfully 13
account for, or pay over the tax or surtax at the time it became due. "Taxes" as used in 14
this section shall include interest accrued under KRS 131.183 and all applicable penalties 15
imposed under this chapter or KRS 131.180, 131.410 to 131.445, and 131.990. 16
Section 4. KRS 142.406 is amended to read as follows: 17
(1) There is hereby created and established in the State Treasury a trust and agency 18
account to be known as the tourism, meeting, and convention marketing fund. The 19
fund shall be administered by the Tourism, Arts and Heritage Cabinet, with the 20
approval of the Governor's Office for Policy and Management. 21
(2) All tax receipts from the tax imposed under subsection (2) of Section 1 of this 22
Act[KRS 142.400] shall be deposited into t he tourism, meeting, and convention 23
marketing fund, and shall be used[appropriated] for the purposes set forth in 24
subsection (3) of this section. The fund shall also contain any other money 25
contributed, allocated, or appropriated to it from any other sourc e. Money in the 26
fund shall be invested by the Finance and Administration Cabinet in instruments 27
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authorized under KRS 42.500. Investment proceeds shall be deposited to the credit 1
of the fund. Money in the fund shall not lapse but shall be carried forward to the 2
next fiscal year or biennium. 3
(3) The tourism, meeting, and convention marketing fund shall be used for the sole 4
purpose of marketing and promoting tourism in the Commonwealth including 5
expenditures to market and promote events and venues related to m eetings, 6
conventions, trade shows, cultural activities, historical sites, recreation, 7
entertainment, natural phenomena, areas of scenic beauty, craft marketing, and any 8
other economic activity that brings tourists and visitors to the Commonwealth. 9
Marketing and promoting tourism shall not include expenditures on capital 10
construction projects. 11
(4) By September 1 of each year, the secretary of the Tourism, Arts and Heritage 12
Cabinet shall report to the Governor and the Legislative Research Commission 13
concerning the receipts, expenditures, and carryforwards of the fund for the 14
preceding fiscal year. 15
Section 5. KRS 198A.190 is amended to read as follows: 16
The corporation is authorized to accept and expend such moneys as may be a ppropriated 17
from time to time by the General Assembly or such moneys as may be received from any 18
source, including the statewide transient room surtax imposed under subsection (3) of 19
Section 1 of this Act and income from the corporation's operations, for e ffectuating its 20
corporate purposes including, without limitation, the payment of the initial expenses of 21
administration and operation and the establishment of a reserve or contingency fund to be 22
available for the payment of the principal of and the interes t on any bonds or notes of the 23
corporation. 24
Section 6. This Act takes effect August 1, 2026. 25