FAQs: Frequently Asked Questions
The sale takes place where the good is located, therefore, if the good is located in Red Lodge prior to shipping, tax would be collected.
The tax monies derived from the Resort Tax may be appropriated by the City Council only for those activities, in those proportions, set forth below:
A. Property tax reduction for taxpayers of the City in an amount equal to five percent (5%) of the three percent (3%) Resort Tax revenues derived during the preceding fiscal year.
B. Ninety-five percent (95%) of the three percent (3%) resort tax revenue must be utilized for capital improvements to streets, alleys, water, sewer, stormwater, emergency services, trails, parks, recreational facilities, city beautification, debt repayment and operational and maintenance cost related to streets, alleys, urban forestry, trails, parks, recreational facilities and city beautification expenditures.
C. The 1% (one percent) resort tax shall only be utilized on the infrastructure projects related to stormwater and stormwater related improvements including, but not limited to, stormwater pipes, stormwater detention, curbs, gutters, sidewalks and streets related to stormwater projects.
You can find current and detailed Resort Tax Budget information here: Budget
Resort Communities are afforded the ability to collect a special tax called Resort Tax through the approval of the electors.
A "Resort community" means a community that:
(a) is an incorporated municipality;
(b) has a population of less than 5,500 according to the most recent federal census;
(c) derives the primary portion of its economic well-being related to current employment from businesses catering to the recreational and personal needs of persons traveling to or through the municipality for purposes not related to their income production; and
(d) has been designated by the department of commerce as a resort community.
Effective May 2, 2019, the Montana Legislature enacted SB 241 which allowed for resort communities, through election petition or resolution pursuant to §§ 7-6-1501 , et seq., an additional one percent (1 %) resort tax to provide funding for infrastructure.
On June 2, 2020, the electorate overwhelmingly renewed the three percent (3%) resort tax and the levy of an additional one percent (1%) resort tax dedicated solely to infrastructure.
The one percent (1%) resort tax shall only be utilized on the infrastructure projects related to stormwater and stormwater related improvements including, but not limited to, stormwater pipes, stormwater detention, curbs, gutters, sidewalks and streets related to stormwater projects.
The City currently collects a 4% resort tax. The three percent (3%) Resort Tax, as approved by the voters, took effect on July 9, 2020 and the one percent (1%) infrastructure resort tax took effect thirty-five (35) days after approval of the electors, which was July 7, 2020
The resort tax is a tax on the retail value of all goods and services sold, except for goods and services sold for resale, within the resort community or area by the following establishments:
- hotels, motels, and other lodging or camping facilities;
- restaurants, fast food stores, and other food service establishments;
- taverns, bars, night clubs, lounges, and other public establishments that serve beer, wine, liquor, or other alcoholic beverages by the drink; and
- destination ski resorts and other destination recreational facilities.
- Establishments that sell luxuries shall collect a tax on such luxuries*.
*"Luxuries" means any gift item, luxury item, or other item normally sold to the public or to transient visitors or tourists. The term does not include food purchased unprepared or unserved, medicine, medical supplies and services, appliances, hardware supplies and tools, or any necessities of life.