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State Sues Booking Agencies

November 3rd, 2009 by flanews

The state is suing two hotel booking companies saying Orbitz and Expedia are withholding state tax dollars. The companies rent hotel rooms at wholesales prices then charge customers a retail price. The problem is theyre only paying taxes on the wholesale price. The practice is costing the state millions. Attorney General Bill McCollum is asking a judge to clarify the issue and hopes the companies comply with the courts decision.

And if we prevail and get this declaratory judgment which is the purpose of it. We would hope that all of the online travel companies would acknowledge this. That going forward that they would pay the taxes that they really owe which is on the rate right here, that they’re the merchants, the retail merchants, on what the consumers pay, what they get from the consumers and we would not have that problem of having to sue them. But if we had to we would,” said McCollum.

The issue was brought up in October at a state cabinet meeting after Chief Financial Officer Alex Sink asked the Department of Revenue to discuss the issue. Sink is backing the AGs suit saying the matter has gone unresolved for far too long. The AG’s office says they’ve been considering a suit since 2008.

Posted in McCollum, State Budget, State News, Taxes | No Comments »

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