Ask the Expert: "Do I Have to Pay When a Hotel Charges an 'Event Fee'?"


As part of our ongoing Ask the Expert program, a meeting planner submitted the question:

"How should we handle it when a hotel charges an 8 percent 'event fee'? This is in addition to a 25 percent service fee and a 6 percent tax? Is this just the cost of doing business?"

To get an answer, we reached out to Jonathan Howe, president and senior and founding partner of Howe & Hutton Ltd. He shared this insight:
"Obviously, the 8 percent event fee and 25 percent service fee are not necessarily the cost of doing business. Rather, they can be fees that provide additional revenue to the bottom line for the event. With the exception of the tax, such fees are always negotiable. Then, on top of it, what we are seeing is inclusion in contracts is setting a top dollar amount that would be charged which would include such fees and taxes, etc.

In other words, 'The fees for this event shall not exceed $__________________ .' As to taxes, in many jurisdictions, fees that go to servers versus the venue may not be subject to tax — but it must be spelled out."

To see more answers to planners' questions, click on the button below.

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And be sure to register for the upcoming webinar, "Ask the Attorney: New Trends in Hotel Contracts," in which Jonathan will answer planner questions live!

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