Score another small victory for the online travel agencies in the hotel-tax skirmishes: In a majority opinion, the Philadelphia County Tax Review Board upheld Expedia’s petition and dismissed the city’s hotel-tax assessment.
Clash of the Titans — AHLA, ITSA discuss terms for a sitdown
February 2, 2010 By 1 Comment
Two leading U.S. travel industry groups, the American Hotel & Lodging Association and the Interactive Travel Services Association, are discussing terms for a sitdown over their bitter clash about ITSA’s push for federal legislation that would limit online travel agencies’ exposure to local hotel-occupancy taxes.
Seven little words worth $21M — ‘OTCs do not control and run hotels’
February 1, 2010 By 3 Comments
A California Superior Court in Los Angeles today set aside a hearing officer’s decision in Anaheim, Calif., in 2009 that would have forced Priceline, Expedia, Orbitz and friends to shell out $21.3 million in hotel taxes tied to their practice of the merchant model.
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Online travel agencies notch hotel tax victory in Houston
January 20, 2010 By 4 Comments
Major U.S. online travel agencies picked up a victory on the hotel tax issue Jan. 20 when a district court judge issued a summary judgment, dismissing hotel occupancy tax claims brought by the City of Houston, Harris County and the Houston Sports Authority.
The defendants’ argued that the complaint should be dismissed because the OTAs do not control hotel inventory and the judge apparently agreed by dismissing the suit.
The ruling in Houston stands in contrast to a decision last fall in San Antonio, Texas, in a class-action lawsuit brought on behalf of 173 of the state’s municipalities. In that ruling, Expedia Inc., Priceline.com, Orbitz Worldwide and Travelocity were socked with a $20.6 million hotel occupancy tax tab as a federal jury concurred with the plaintiffs that the OTAs were “controlling hotels” when they offered rooms on a merchant model basis.
Florida sues Expedia and Orbitz, but what else you really audit know
November 4, 2009 By 1 Comment
The State of Florida and six Florida counties sued Expedia and Orbitz Nov. 3 over the hotel tax issue, ratcheting up the cross-country flurry of litigation.
The usual M.O. is for cities and counties to sue on this issue, but Florida Attorney General Bill McCollum says Florida, with its large hotel business and tourism destinations like Orlando and Miami, is the first state to do so. He says the state suit will help sort out the applicability of state tax laws to Internet travel firms.
In thinking about the hotel tax issue, one point that many people may be missing about the depths of the problem for the OTAs is that they are being hounded with scores of tax audits and assessments in addition to the lawsuits.
Big Four OTAs socked with $20.6M hotel tax verdict in Texas
November 2, 2009 By 4 Comments
The Big Four U.S.-headquartered online travel companies — Expedia Inc., Priceline.com, Orbitz Worldwide and Travelocity — were socked with a $20.6 million hotel occupancy tax tab as a federal jury in San Antonio, Texas, ruled against them in a class-action civil lawsuit brought on behalf of 173 of the state’s cities and towns.
The U.S. district court jury in City of San Antonio v. Hotels.com found that the OTCs were “controlling hotels” when they sold room nights on a merchant-model basis, and thus were liable for tax on their retail rates and not just the wholesale deals they got from the hotels.
And, that $20.6 million potential liability does not yet even take into account the penalties and interest that might be imposed.
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Wanted: Hotel tax scorecard for game of gotcha
October 8, 2009 By Leave a Comment
The game of gotcha between U.S. cities and the online travel agencies continues and it’s almost a full-time job just trying to keep tabs on the whole thing.
It sort of reminds me of my visit to the Orbitz TLC Center last week, where about nine people, including three former air traffic controllers, were on duty, monitoring plasma screens filled with gridlocked jets and typhoons.
Somewhere, undoubtedly, a team of lawyers is hunkered down in a corporate boardroom, monitoring a torrent of hotel-tax motions, city audits and new ordinances across the country.
Anyway, here’s what’s been going on in the last few weeks as municipalities seek to force the OTAs to pay occupancy taxes on retail rates when they sell hotel rooms on a merchant basis, and the OTAs fight back.
