The Ozarks tourist town of Branson is suing 15 Internet travel companies, including Travelocity and Expedia, claiming unpaid back taxes on hotel room bookings.
Branson’s lawsuit, filed in Greene County Circuit Court last week, alleges the travel services either failed to collect or remit a 4 percent hotel room tax.
The litigation follows similar legal efforts in Los Angeles, Philadelphia, Atlanta, Chicago and elsewhere, where officials have alleged that online travel services charged customers for local tourism taxes but never remitted those funds. The Philadelphia and Atlanta lawsuits have since been dismissed, according to the industry group Interactive Travel Services Association.
Art Sackler, executive director of the Washington-based association, said Thursday that online travel sites are simply the brokers who collect money for reservations to pass along, minus a service fee, to the hotel.
“The companies send back to the hotel whatever the negotiated room rate is plus the applicable tax,” Sackler said. “It’s the hotel’s responsibility to send the taxes on to the city or the county.”
Terry Dody, Branson’s public administrator, said it’s unclear exactly how much money went unaccounted for, but he said estimates are “substantial.”
“It’s almost impossible to put our arms around it, because we are not sure how many bookings (there were),” Dody told the Springfield News-Leader. “Over the years, you can imagine what it adds up to.”
Sackler said cities such as Branson ought to first go through their own local tax procedures for collecting any revenue they believe is outstanding.
Companies being sued include Dallas-based Hotels.com LP; San Francisco-based Hotwire Inc.; Fort Worth, Texas-based Travelocity, which is a unit of Sabre Holdings Corp.; and Springfield-based TravelNow.com Inc.; Chicago-based Orbitz LLC and Columbia S.C.-based Expedia Inc.