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The City of San Diego can not collect the full amount of hotel taxes from online travel companies, a California state court ruled earlier this week.

Like many other cities across the country, officials in San Diego are asking online travel companies such as Expedia, Priceline, Orbitz, and Travelocity to pay hotel occupancy taxes on the amount that they sell rooms for, not the amount that they pay for the rooms. Typically, travel companies buy blocks of rooms and sell them at a higher price but pay taxes on the lesser amount.

Similar cases have been tried in courtrooms across the country. According to the Interactive Travel Services Association, three different courts have ruled in favor of the online travel companies.

“Municipalities and [online travel companies] should work together to promote travel and tourism for everyone’s benefit, rather than both sides’ expending precious resources on futile litigation,” said Interactive Travel Services Association Executive Director Art Sackler.
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Comments

InOmbra Sept. 9, 2011 @ 12:40 p.m.

"“Municipalities and ... companies should work together to promote travel and tourism for everyone’s benefit,..."

Right, "everyone's benefit," including the resident citizens and taxpayers of the municipality. One example of a tax being paid by hotel customers, the TMD add-on to the hotel bill, benefits only the hotel owners and is excluded from the General Fund. The current TMD, put into place in 2008 and due to expire December 2012, is up for some changes: Please note Council Item 53, on Council docket for Tues, Sep 13 2011.

And hey, where's the captcha???

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SurfPuppy619 Sept. 9, 2011 @ 5:26 p.m.

And hey, where's the captcha???

/ Please, don't jinx us.

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