North Carolina bill could limit Buncombe tourism tax spending

A bill moving through the General Assembly could tighten how Buncombe County spends its tourism tax, shifting more control from local commissioners and the Buncombe County Tourism Development Authority to Raleigh. For Asheville and the rest of the county, the practical question is whether visitor dollars will keep underwriting local tourism marketing and development, or whether lawmakers will fence off those revenues for a narrower list of uses.

Buncombe’s occupancy tax is 6% on gross receipts from lodging, including short-term rentals booked through Airbnb and VRBO. The county’s tourism tax dates to 1983, when the General Assembly authorized a 2% room tax for Buncombe and several other counties to support travel and tourism promotion. Today, the county’s tourism economy generates far more money, with the Buncombe County Tourism Development Authority approving a $27.3 million operating budget for fiscal year 2025, down from $27.5 million the year before, while projecting about $34.3 million in occupancy-tax revenue.

State law already directs most occupancy-tax proceeds toward tourism promotion or tourism-related spending rather than general fund use, according to the University of North Carolina School of Government. North Carolina counties collected $325.9 million from 82 county occupancy taxes in fiscal 2021-22, showing how significant the levy has become as a local revenue stream across the state.

The latest push comes after the Currituck County fight over whether occupancy-tax money was being used too broadly. Taxpayers there challenged spending on law enforcement, fire and emergency response, lifeguards and road maintenance. The North Carolina Court of Appeals ruled against Currituck in March 2024, and the North Carolina Supreme Court took the case before issuing a decision in May 2026. A separate 2026 House bill responding to that dispute would block counties from using occupancy-tax funds for public safety and other core services, a sign that lawmakers are trying to draw harder lines around the tax.

For Buncombe, that could matter far beyond the courthouse steps in Raleigh. Recent proposals have already tried to reshape how the county’s tourism money is divided, including lowering administrative spending caps and splitting net proceeds among marketing, tourism product development and legacy investment funds. A state bill summary for S132 in 2025-26 also says it would take effect only if Buncombe County created a Swannanoa Valley Tourism Development Authority.

That leaves the county at the center of a broader fight over local flexibility. Buncombe leaders and tourism officials want room to tailor spending to Asheville, the county’s neighborhoods and the mountain visitor economy. State lawmakers appear ready to decide whether those dollars stay a local economic tool or become a more tightly controlled pot of tourism-only money.