When visitors dine at Alexandria restaurants, stay in local hotels, or shop along King Street, they’re helping fund essential municipal services through the taxes they pay.
Alexandria’s tourism industry generated $88 million in consumption tax revenue during fiscal year 2025, a $2 million increase from the previous year, as visitor spending reached $1 billion for the first time in the city’s history. These taxes on sales, meals, and lodging from visitors traveling more than 50 miles to the city directly support the city’s core services.
“$88 million in consumption taxes, you know, why is that important to me? Many of you understand that. But to the community, that means that we can fund more books in the library. That means that you know, another teacher in the classroom. That means, you know, a little help to someone who’s experiencing being unhoused,” City Manager Jim Parajon said Thursday during Visit Alexandria’s annual meeting. “That means just a little bit more that we can do for our community.”
The tourism-generated revenue saves the average Alexandria household $832 annually, according to Parajon and Visit Alexandria data. For a city of approximately 174,000 residents, Parajon said the economic impact demonstrates that Alexandria punches “way above our weight.”
Caption: Alexandria’s visitor spending reached $1.016 billion in 2024, up from $941 million in 2023, marking a dramatic recovery from the pandemic lows of $445 million in 2020.
Credit: Visit Alexandria
The consumption taxes flow into Alexandria’s general fund, providing more than 10% of the city’s general fund revenue. Sales taxes are generated from retail purchases by visitors, meals taxes come from dining at restaurants, and lodging taxes are collected from hotel stays.
This funding mechanism builds on Measure J, a one-cent sales tax approved by voters in 2011. The $88 million represents the highest level of consumption tax revenue Alexandria has recorded.
The tourism industry supports over 5,700 jobs in Alexandria and generated more than 1 million room nights in the past year. Visit Alexandria’s data shows that 94% of respondents to the latest resident satisfaction survey say Alexandria is a great place to visit.
Parajon emphasized that tourism’s economic impact extends beyond the hospitality sector, describing all community members as participants in the economic development of their community. He noted that everyone serves as an ambassador for the city.
“We’re all ambassadors. And the more that we can be that the more we’re going to be successful as a community,” Parajon said.
Todd O’Leary, Visit Alexandria’s president and CEO, said the organization aims to “grow city consumption taxes to over $100 million by the end of fiscal year 2029.”
Alexandria served as the official team base camp for Al Ain FC from the United Arab Emirates during the FIFA Club World Cup. The city is preparing for America’s 250th anniversary celebrations in 2026.
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