Amidst the frenzy of “Amazon Tax” bills sweeping the country, including in the Commonwealth of Virginia, I didn’t have a chance to make mention of a bill introduced in – and passed – by that state’s senate requiring online travel companies to collect sales and hotel taxes on the retail (not the wholesale) price on hotel rooms.
Sales Tax Buzz has been following closely the fascinating line of cases throughout the country in the battle to collect state and local transaction taxes on the actual, final price paid by online customers vs. the wholesale rate at which the online travel companies purchase the rooms directly from the hotels.
In a bold move, Virginia’s Senate is looking to legislate the answer in favor of the full price alternative or, in the language of the bill, “based upon the total charges or the total price paid for the use or possession of the room.” Essentially, this means the tax will be imposed on any price mark-up and other charges and fees the online companies may charge in connection with the rental.
For all retail sales of hotel accommodations, both the hotel and the online travel company (or “accommodations intermediary,” in the language of this bill) would be required to separately state the amount of tax on the bill and to add the tax to whichever charge it is required to collect.
And in rather inclusive language, the bill defines “accommodations” as “any room or rooms, lodgings, or accommodations in any hotel, motel, inn, tourist camp, tourist cabin, camping grounds, club, or any other place in which rooms, lodging, space, or accommodations are regularly furnished to transients for a consideration.”
S.B. 452, was passed by the Virginia Senate on February 1st and, as of February 16, is in review in the House Committee on Finance. 
Filed under: E-Commerce, Legislation Tagged: | Expedia, Hotels, Hotels.com, online hotel brokers, online travel companies, Orbitz, S.B. 452, sidestep.com, Virginia
Well it is about time that some state gets tough and passes law to get their money they deserve. Why leave it to the courts who get things wrong and not just make it the law in the state? Why won’t other States do the same thing as Virginia?
I can’t agree more w/the previous commenter. Wish my state would do it so we’d have more money for services. And no, the recession is far from over and the states are going to need their revenues for a long time to come.
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