Las Vegas Tourism Officials Expect Decline in Room Tax Revenue for 2025-26

Posted on: April 9, 2025, 02:18h. 

Last updated on: April 9, 2025, 03:02h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.
  • Las Vegas visitation could slow in the months ahead
  • Economic worries could negatively impact Las Vegas and the Strip
  • The Las Vegas Convention & Visitors Authority is primarily funded through hotel room taxes

The Las Vegas Convention & Visitors Authority (LVCVA) was told Tuesday during its regular monthly meeting that it should expect a slowdown in tourism in the months ahead.

Las Vegas hotel tax tourism LVCVA
The Las Vegas Strip is seen at night. Las Vegas tourism officials are being told to brace for a slowdown in hotel occupancy, which will reduce local tax money. (Image: Shutterstock)

The LVCVA, tasked with promoting Southern Nevada as a premier destination for business conventions and leisure travel, is primarily funded through hotel room occupancy taxes within Clark County, including on the Las Vegas Strip. The LVCVA also owns and operates the Las Vegas Convention Center and Las Vegas Monorail.

In the 2024 fiscal year, the LVCVA collected $382.7 million in room taxes, a record amount that was an 8.1% year-over-year increase. Officials with Applied Analysis, the longtime economic partner of the LVCVA, told the agency that they should expect a slowdown for 2025 and budget for less revenue in FY26.

Applied Analysis Principal Jeremy Aguero said declines in foreign travel, particularly from Canada and Mexico, and weaker consumer sentiment are likely to lead to reduced visitation in Las Vegas. That will result in reduced room taxes earmarked for the LVCVA. 

Las Vegas Outlook

Aguero told the LVCVA that he expects room tax revenue to slow, as visitation eases and hotel rooms naturally lower rates.

However, it’s more difficult at this juncture to predict the Las Vegas economy because of President Donald Trump’s ongoing tariff war. How tariffs will impact the global economies and whether consumers will pull back their leisure spending and businesses will limit nonessential costs such as attending conferences in Las Vegas is unknown.

LVCVA President and CEO Steve Hill said the agency will meet in May to consider its 2025-26 operating budget.

“It’s hard to tell what the tariff policy will be right now, three months from now, or seven months from now,” Hill said of the difficulty in budget planning.

Clark County’s Transient Lodging Tax Rate for casino resorts on the Las Vegas Strip is 13.38%. The hotel tax varies elsewhere, with the lowest tally being 10.5% for hotels/motels outside of 35 miles of the Las Vegas Convention Center.

2024 Visitor Spending 

Aguero said Applied Analysis’ review of visitor behavior in Las Vegas last year found that their trip spending increased almost 5% to $1,322 per person. The $1,322 spending level is 53% higher than 2019.

The spending increases were largely driven by higher costs for hotel rooms, resort fees, parking, retail shopping, and food and beverage. Spending decreased on gaming, sightseeing, and sports.

Visitor per-person spending, the Applied Analysis report revealed, has increased each year since 2020. Trips to Las Vegas becoming continuously more expensive for almost a half-decade is causing some consumer lethargy.

Many would-be Las Vegas visitors say the costs are keeping them away and that Sin City no longer provides value. 

“The value proposition of Vegas has completely collapsed. Overpriced. Everything is worn down. Not fun. Younger people don’t gamble. Not much else to do. There was a time when you could get great value and have a great time. Now you’re just feeling ripped off,” read a comment on X that has gone viral with over 15K likes.