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Local hotel wants travel sites taxed in-state

Local hotel wants travel sites taxed in-state

By Mary Richards | Posted - Nov. 10, 2011 at 12:24 p.m.

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SALT LAKE CITY -- According to some, when you book a hotel room online, you are adding to the debate between hotels and travel companies over taxes.

Utah hotels say online travel companies are not paying the full amount of local tax on their transactions and now they are appealing to the Utah State Legislature.

The area general manager of the Marriott hotel chain, Steve Lundgren, told a legislative committee about it. According to Lundgren, companies like Expedia, Travelocity and Orbitz pay tax only on the wholesale amount and pocket the difference as a service fee

"We believe there's an unfair advantage to the hotels in this state, because we pay tax on the full retail amount," Lundgren said.

The Utah hotel industry wants legislation to deal with this; but Senator Curt Bramble says it's part of a larger, national issue.

"How does the State Tax Commission address the compliance with the out-of-state reseller, or out-of- state customer?" he said.

Others say if the tax loophole continues, governments will lose more money. They'll talk about it again at a revenue and taxation interim committee meeting next week.

Mary Richards


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