room tax

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From HotelOnline:

Court finds that Online Travel Companies (OTCs) ‘help consumers make informed choices in spending their travel dollars, and to do so conveniently and efficiently.’

The Texas 14th Court of Appeals yesterday affirmed that online travel companies (OTCs) pay all of the taxes that they are legally required to, and that the City of Houston and the Harris County-Houston Sports Authority cannot impose taxes on them for their reservation services. This decision follows the clear national trend, where state and federal courts have rebuffed efforts by state and local governments to attempt to impose taxes on online travel companies for their services.

The court went on to point out that an OTC, “does not have rooms or occupancy… the OTCs do not have the right to use or possess hotel rooms. Instead, the OTCs have websites and provide information.” The court noted that, “the OTC does not purchase the right to use the room and then resell that right to a consumer, and does not promise that any reservations will be made.” OTCs simply allow their customer to place a reservation with the hotel through the OTCs’ websites.

The court also correctly applied long-standing rules of statutory construction in interpreting a tax statute: if the taxpayer’s interpretation of the words of the statute is reasonable, the taxpayer prevails and any ambiguity must be resolved in favor of the taxpayer. Here the court held that the OTCs’ argument that their compensation was not part of the “cost of occupancy” was reasonable, and that “the provisions at issue reasonably can be construed to tax only the amounts paid to hotels,” so it ruled in favor of the OTCs.

Read the article in its entirety from HotelOnline here.


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The state Legislative Fiscal Bureau just finished its two-year publication, “Local Government Revenue Options – January 2011”, which outlines the types of taxes local governments can impose, including Room Tax (see pages 5-8 plus an Appendix on pages 15-17). This has been updated every two years since about 2001. The publication can be downloaded here.

While the Appendix does list room tax rates alpha by county, then alpha by municipality, it only includes the rates in effect Jan. 1, 2010, in municipalities that already had a room tax before. Thus it does not reflect the municipalities imposing a room tax for the first time, which is why the list created in February 2010 by the WH&LA (included for lodging members only available here) includes the rates of 13 additional municipalities.

The new state publication does show total reported room tax collections for each municipality, as well as the total reported state-wide. It shows that total collections peaked at $63.72 million in 2008, but dropped down to $55.83 million in 2009. The total municipalities with room tax that they tracked went down slightly from 258 in 2008 to 257 in 2009, but again this does not reflect total counts including first time room tax areas.

This publication also includes sections on:

  • Local Exposition District Taxes
  • Local Professional Baseball Park District Taxes
  • Local Professional Football Stadium District Taxes
  • Premier Resort Area Tax
  • Regional Transit Authorities
  • County Sales & Use Taxes (including a chart on the 61 counties imposing the 0.5% county sales tax)

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A new Room Tax resource with a national perspective has just been released, called “Lodging Tax Primer.” The purpose of this new resource is to provide a nation-wide explanation of Room Tax/Lodging Tax, how it varies around the country, what some of the primary challenges have become and some solutions that can be pursued to restore the integrity of the tax.

The target audience ranges from the lodging industry to all of the tourism industry to state and local government officials and to the media, who frequently do not know any background helpful in presenting a fair overview in their writings. There previously was no overview of this tax and it’s implications.

The entire WH&LA Advisory e-mail can be found here (password protected for lodging members only) by clicking the November 9 link, and the Lodging Tax Primer is available to the public from the Room Tax Tools page at the members site on


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The Wisconsin Hotel & Lodging Association (WH&LA) Room Tax Task Force has developed a new tool to help determine if local Room Tax is compliant with state statutes. The WH&LA Wisconsin Room Tax Self-Audit Tool will help you make sure your local tourism industry is receiving appropriate funding for tourism promotion and development from the tax.

This five-page tool is designed to guide lodging and other tourism businesses, CVBs, chambers of commerce and municipalities through an analysis of the room tax authorized in individual municipalities.

The Room Tax Self-Audit Tool can be found here, by clicking the 8/31/10 link. (This page is password protected for WH&LA Lodging Members only. If you need assistance with logging in, e-mail Michelle or call 262/782-2851.)


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WIA logoMembership in the Wisconsin Innkeepers Association is an investment in your success! From promoting your property in our Wisconsin Lodging Directory to our contract Lobbyist in Madison to our monthly electronic newsletter -The InnSider- we bring results.  Below are just a few of the ways we work for you….

Expand your marketing presence while saving money through:

  • A free listing in the Official Wisconsin Lodging Directory (annual distribution over 220,000)
  • A free, complete listing at (over 22,000 unique visitors last month alone)
  • Two dozen online, digital billboard and print advertising opportunities in niche markets that are important to you

Protect the interests of your business; from Room Tax to State Tourism Marketing Funding and beyond, we make sure you’re heard.  You’ll also be kept informed about regulatory changes impacting your business before it’s too late.
Whether you’re recruiting employees, advertising to travelers, or training new or existing staff, members-only discounts are available to help you.
Make new connections with some of the best and brightest in Wisconsin lodging at Committee meetings, Seminars, and our Annual Lodging Conference & Trade Show. Additionally, WIA keeps you connected to our national organization (AH&LA) as well as other state tourism groups.
From free preliminary legal advice from our experienced legal counsel to the Innkeepers’ Resource Guide, we have the answers to your questions.
Discounted training materials, educational workshops, and our Resource Lending Library provide you and your team a variety of training opportunities.
Current information and timely notices -including the latest Smith Travel Research Data for Wisconsin -through our quarterly InnTouch magazine, monthly electronic InnSider, and Legislative E-Alerts keep you up-to-date.


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