Arkansas Tourism Sales Tax Collections Recover, with Bentonville, Eureka Springs and Little Rock Showing its Strong Future Growth Prospects

Published on December 15, 2025

Following the record year of 2024, Arkansas’ tourism economy experienced a downturn of sorts in early 2025 with statewide tourism sales tax collections dipping almost 2%. However, that has given way to a bounce-back during the summer months, and smaller cities such as Bentonville, Eureka Springs, and Little Rock are now reflecting local tourism tax receipts in positive territory. That would suggest the state’s tourism economy is finding its footing, though not without a few still-lingering scars.

Bentonville’s Rise in Tourism Revenue

One of the standout performers in Arkansas’ tourism scene this year has been Bentonville, which has seen a remarkable increase in tax receipts from hotel and restaurant sales. By September, the city collected $3.47 million in taxes, reflecting a 6% increase from the previous year. Much of this growth is attributed to the surge in restaurant openings and the arrival of new hotels, including the AC Hotel by Marriott, which opened in May. Kalene Griffith, President and CEO of Visit Bentonville, emphasized that the addition of new hotel supply rather than an increase in visitor numbers has driven this growth.

While the growth in restaurant tax receipts has been especially strong, lodging remains an area of concern, as business travel has not yet returned to its pre-pandemic levels. The hotel occupancy rate in Bentonville continues to be impacted by inflation, which has made both local and national lodging more expensive. This presents a complex picture, as new business openings are helping to prop up growth, even as traditional sectors like lodging experience challenges.

Eureka Springs Benefits from Tourism Momentum

Just to the east of Bentonville, Eureka Springs, known for its Victorian architecture and attractions like The Great Passion Play and the Christ of the Ozarks, has experienced impressive growth in its tourism tax collections. The city saw a 9% increase in hotel and restaurant tax receipts in the first eight months of 2025, amounting to $1.38 million, compared to $1.26 million the previous year. Eureka Springs, a beloved destination for its historic charm, has been steadily attracting visitors looking for unique cultural and natural experiences, with arts tourism continuing to be a significant draw.

Little Rock’s Strong Performance Amid Challenges

Despite a challenging start to the year, Little Rock is on track to set another record in tourism tax receipts by the end of 2025. With $16 million in tax collections from lodging and restaurant sales by October, Little Rock has seen a 2.4% increase from the previous year. Gina Gemberling, CEO of the Little Rock Convention & Visitors Bureau, anticipates that the city will continue to benefit from ongoing events and attractions throughout the remainder of the year. The restaurant tax is leading the charge, with a strong increase in consumer spending in the local dining scene.

The city’s growth is further bolstered by its diverse tourism offerings, including new restaurants, events, and a growing number of visitors drawn by business events and conventions. While lodging tax collections have fluctuated, the overall trend is positive, and Little Rock remains a critical player in the state’s tourism economy.

Challenges for Springdale and El Dorado

While some cities are thriving, Springdale has faced significant challenges, particularly in hotel tax receipts. The city saw a 13% decline in its hotel tax collections by October, largely due to an increase in hotel supply and a dip in tourism-related events like Razorback football games. The University of Arkansas’ football season was disappointing, which contributed to lower-than-expected attendance and affected hotel occupancy rates. However, Springdale is hopeful for future recovery, with plans for new tourism initiatives on the horizon.

Similarly, El Dorado has seen a downturn in tourism tax receipts, down by 18% in 2025 compared to the previous year. The city’s performance was especially impacted during the summer and early fall months. However, there are signs of a recovery, with some positive trends in later months. Mayor Paul Choate remains optimistic about the city’s potential for future growth as new events and initiatives begin to take shape.

Impact of Short-Term Rentals on Tax Revenue

A significant issue for some cities in Arkansas is the increasing influence of short-term rentals like Airbnb and Vrbo, particularly in tourist-heavy areas like Hot Springs. These rentals, which often operate outside of city tax structures, have created challenges for lodging tax collections in Garland County. Steve Arrison, CEO of Visit Hot Springs, pointed out that over 1,000 short-term rentals are not subject to the tourism tax, leading to a loss of potential revenue for the city. These rentals, while benefiting visitors looking for alternative accommodations, have also placed pressure on traditional hotels, which see their occupancy rates and tax receipts affected.

Looking Ahead: Arkansas’ Tourism Prospects for 2026

Despite the challenges faced in 2025, there is a general sense of optimism for Arkansas’ tourism future. As new attractions, businesses, and events continue to open, the state’s tourism industry remains resilient. Many cities, especially in northwest Arkansas, are looking to capitalize on the expansion of cultural offerings, including the Crystal Bridges Museum of American Art and an expanding arts tourism sector.

The state’s continued investment in tourism promotion and its diversified approach to attracting both business and leisure travelers will be crucial as it heads into 2026. Key events like America’s 250th birthday celebrations and FIFA World Cup 2026 activities provide a solid foundation for tourism growth in the coming years.

Future Impact: Fostering Sustainable Growth in Tourism

As Arkansas looks to 2026 and beyond, the state must remain focused on ensuring that tourism growth is sustainable. The rapid expansion of the industry presents opportunities, but also risks of over-tourism and environmental strain. Future efforts should center on promoting eco-tourism, supporting local businesses, and protecting natural resources, especially in regions like Bentonville, Eureka Springs, and Hot Springs. By prioritizing sustainable tourism practices, Arkansas can ensure that its tourism industry grows without sacrificing its natural and cultural heritage.

A Shifting Landscape for Arkansas Tourism

Although tourism sales tax collections in Arkansas dipped in the early part of the year, signs of recovery and growth in communities like Bentonville, Eureka Springs, and Little Rock underpin the fact that the sector is pretty resilient. The state’s shift toward restaurant sales growth and new business openings shows promise for the future. Of course, challenges including short-term rentals and declining hotel stays are things to be ironed out for sustainable growth. Going forward with eco-tourism and arts tourism, and for years to follow, there will be a great need for balance between tourism practices and the protection of both the local culture and the environment. With strategic planning, Arkansas can look forward to a thriving tourism sector well into the future.