Major online travel agencies notched another win in their ongoing, countrywide hotel tax battles when a judge in St. Louis tossed a suit brought by St. Louis County, Missouri.
In an oral ruling Sept. 8 in St. Louis County, a judge in the Circuit Court of St. Louis County dismissed the case, which alleged violation of tourism tax statutes and a hotel tax ordinance.
Defendants in the case included Expedia, Priceline, Travelocity, Travelport, Orbitz and some of their subsidiaries.
A spokesman for the Interactive Travel Services Association, which speaks for major OTAs on the issue, says the judge “apparently cited the new Missouri law that occupancy taxes cannot be assessed on intermediaries as a primary rationale for his decision.”
ITSA says 10 of 12 rulings on the merits of the hotel tax issue across the U.S. now have been decided in the OTAs’ favor.
Ongoing suits allege that the OTAs improperly remit hotel taxes on the net rates they get from hotels instead of the retail rate that consumers book.
The OTAs counter that they are not responsible for taxes on the full retail rate because they are not hotel operators.
Dennis,
Are OTAs collecting taxes from their customers based upon the retail rate they charge?
Douglas
Douglas: As you know, the OTAs say they are not collecting taxes on the retail rate they charge. They collect taxes on the net rate and the rest is their booking fee or markup. Why do you ask?