OTAs ordered to pay Hawaii $150 million


Last year was a landmark twelve months for Hawaii. Image: Hawaii Tourism Authority/Tor Johnson

Online travel agents (OTA) owe Hawaii a decade’s worth of back taxes and interest, a judge in Honolulu has decreed.

According to the state attorney general’s office, the court ordered certain OTAs to pay the state around US$150 million after the judge ruled that Hawaii’s general excise tax applied to the sale of hotel rooms by online agents.

The websites involved in the case, which include Expedia, Hotels.com and Travelocity, have made sales of more than $2.7 billion in Hawaii hotel room sales since 2000, a press release said.

Govenor Neil Abercrombie called the decision a “significant ruling” for Hawaii, which as part of the judgement, could reap extra annual tax collections of $20 million.

Speaking in support of the decision, Hawaii Attorney General David Louie said the state could look forward to reaching a final resolution and “collecting these monies for the people of Hawaii”.

“Hawaii hotels are good corporate citizens, paying their fair share of taxes to support the state’s infrastructure, such as roads, schools, personnel and other costs, and the OTCs need to also play by the rules and pay their fair share,” he said.

Meanwhile, a spokeswoman for Expedia, Mallory Seubert, said the company “strongly” disagreed with the decision and was considering all of its options, Associated Press reported.

The court ruling comes on the back of an announcement by the Hawaii Tourism Authority that the state welcomed a record 8 million travellers to its shores in 2012.
Source = e-Travel Blackboard: M.H
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