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Issue of online travel firm taxes continues to smolder
The number of municipalities suing online travel firms has now gone up to 200, according to The Wall Street Journal.
The suits began in Florida where government officials complained that online travel companies such as Expedia and Travelocity are not paying proper taxes when selling hotel rooms.
The 200 municipalities have a combined more than 20 lawsuits over the issue. Cities range from Los Angeles to Chicago to Charleston, SC.
The dispute centers around whether the online companies should pay taxes on the lower rate they negotiate directly with hotels or the higher rate they charge consumers.
The Journal also reports that the suits, which have often stumbled in the past, are starting to gain traction. For instance, the newspaper says a federal judge in Texas recently granted class-action status to 175 cities suing the online companies.
Report by David Wilkening
David
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