2023 Arizona Tourism Tax Revenue Tops $4B For First Time

A saguaro cactus sits in silhouette during a sunset. Photo Courtesy of Visit Tucson

Total tax revenue generated by tourism-driven economic activity in Arizona topped $4 billion for the first time ever in 2023, signaling the multifaceted industry’s position as a consistent supporter of communities of all sizes across the state, according to new data released today by the Arizona Office of Tourism.

In 2023, the Arizona tourism industry achieved year-over-year growth across the board, including a 1.7% increase in visitation, 4.3% jump in visitor spending and 4.4% increase in tourism jobs. This includes hosting nearly 41 million domestic overnight visitors who spent $29.3 billion across Arizona’s 90+ cities, towns and communities, which equates to $80 million spent every single day here.

Additional topline industry metrics including jobs generated and tourism wages earned all also topped last year’s figures, highlighting the continued successful positioning of Arizona as a top-tier travel destination.

“The data is in: people love coming to Arizona and our economy is growing because of it,” said Governor Katie Hobbs. “Tourism supports critical services for Arizonans, and our work to build an Arizona for everyone translates to more visitors and more jobs for our great state.”

“Our strong 2023 shows how placing Arizona’s majestic beauty, welcoming warmth and abundant diversity at the forefront of our visitor attraction efforts continues to deliver,” said Lisa Urias, CEO of the Arizona Office of Tourism. “Whether you’re an Arizonan on an in-state road trip, joining us from across the country for Cactus League Spring Training or an international visitor seeing the Grand Canyon for the first time, we always appreciate that Arizona remains a top choice.”

The $4.2 billion in total tax revenue generated in 2023 comprises local, state and federal taxes, and represents an increase of 7% over 2022. Tourism tax revenue supports vital services such as health care, public safety and transportation.

ADDITIONAL 2023 DATA INSIGHTS:

• Arizona remains popular with out-of-state visitors. 71% of 2023 overnight visitors were non-residents. Leading contributor states: California, Texas, New York & Florida.
• International visitation and spending topped 2022 by double digits. International visitation is up 20% and international visitor spending is up 30% from 2022.
• Mexico leads the way as the top source market for international visitors. Top seven international markets of origin for Arizona in 2023 are, in order: Mexico, Canada, UK, Germany, France, India and Italy.
• International visitation continues to recover. Full international visitation recovery to 2019 levels is expected in 2026.
• Small shifts in visitation deliver huge impacts. Each 1% shift in visitor volume represents slightly more than 400,000 overnight visitors.
• Tourism marketing works. 55% of visitors reported being influenced to visit due to marketing
• Visitors’ positive experiences deliver a lasting impact on future travel decisions. We do well in delivering great vacations, as 86% of our 2023 visitors are repeat visitors and 73% of our visitors reported being very satisfied with their trip here.
• The tourism industry added nearly 9,000 jobs. Arizona’s tourism and hospitality industry added 8,950 jobs in 2023 (187,000 total), an increase of 4.4% over 2022 (179,100 total).
• Tourism is a crucial contributor to the state budget. The $1.15 billion in state tourism tax revenue collected in 2023 delivered approximately 10% of the state’s entire operating budget for the year.
• Tourism spending reduces the tax burden for residents in every county. Coconino County experienced the largest reduction in tax burden per household from travel spending ($3,369), followed by La Paz ($1,963), Gila ($1,330), Santa Cruz ($1,218), Yavapai ($1,155) and Navajo ($1,026). These numbers highlight the enormous impact of tourism spending in Arizona’s rural counties. The overall statewide Arizona average is ($889).

AOT presented this data during its 2024 Governor’s Conference on Tourism, which was held at the JW Marriott Scottsdale Camelback Inn Resort & Spa Aug. 21-23, 2024. The annual meeting connects leaders from across the state’s travel and hospitality industry. For more information about the data, visit tourism.az.gov/2023-az-tourism-tax-revenue-tops-4-billion-for-first-time.

For more information about visiting Arizona, visit visitarizona.com.