Hotel Taxes & OTAs: The Next Round

Aloha Kakou:

A judge in California Monday ruled that Online Travel Agencies (OTAs) are not hotels and therefore are not required to pay accommodations tax on the amount between their net rate and the rate to which they sell the room to the consumer.

There are many similar pending cases around the US as municipalities seek ways to help offset budget losses. Going after OTAs may seem like a natural to politicians in these municipalities as they believe they can gain additional income without having to raise the ire of their constituents by raising their taxes.

http://www.reuters.com/article/idUSTRE61109G20100202