Travel booking sites prevail in TN tax suit

NASHVILLE, Tenn. (AP) -- Hotel booking websites including Priceline, Travelocity, Expedia and Orbitz have prevailed against more than a hundred Tennessee counties and municipalities in a legal fight over hotel tax collections.

A federal judge granted a summary judgment in favor of the online travel companies last week and said the state's hotel tax should be levied based on what hotels charge, not on the rate consumers pay if they book a room through one of the travel sites.

The Tennessean reports that the 129 cities and counties they were owed millions in unpaid hotel taxes because the travel companies were charging consumers discounted room rates plus a markup for the online travel sites' services.

The online travel companies successfully argued the additional markup should be excluded from the tax calculation.


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