Matt J
SWGB
Legislators to Decide if Online Travel Booking Agencies Should Be Required to Pay Hotel Bed Tax
The State House of Representatives is currently entertaining two bills regarding taxes for online travel agencies.
One would allow Florida?s counties to collect bed taxes on the amount the customer pays for a hotel room.
The other would formalize what's already happening, collections on the amount the on-line agency pays the hotel for the room.
Some feel charging tax on the total cost would amount to a service tax.
"Thank you for calling bookit.com" Sales reps echo at the BookIt.com headquarters in Panama City Beach.
And it?s becoming one of the largest on-line travel agencies in the southeast.
It competes with sites like Travelocity and Expedia.
If the one proposal that would make them pay taxes on the full amount of a hotel room were to become law, bookit.com officials say it would drastically alter the way they do business.
Bud Finlaw is the Founder and CEO of bookit.com and he says the tax would be detrimental to the company.
"As you raise prices, sales go down, so we feel like it will actually hurt tourism when prices go up because of the new tax that's been implemented? Finlaw says.
Tourist Development Councils across the state are on the other side of the issue.
They say the online travel agencies are already cutting into their bed tax collections.
Bay County TDC Director Dan Rowe says he's not looking for any money the online agencies didn't pay over the last few years.
But he does want the sites to start paying the bed taxes.
"We completely understand the position the online travel agencies are in. And they are a good partner because they do provide a service that is very important to the tourism community. But our position is, we want them to remit the full amount of the tax from this day forward? says Rowe.
Tom DiBacco is the Vice President of Bookit.com and is having a hard time understanding where the TDC is coming from.
"In the long run, they may win the battle but lose the war. They realize how important tourism is to Bay County, and at the same time they realize how important jobs are here. So why would you support anything that would go after your number one industry which is tourism and then one of your own which is here providing high paying jobs? DiBacco says.
The online agencies have found a friend in State Representative Jimmy Patronis.
He's sponsoring a bill that would exempt the agencies from paying taxes on the total cost of room rental.
Patronis says his bill will let everyone know where they stand.
"Try to create a policy that makes it clear, cut, and understandable for the department of Revenue to do their job. And that's whether to create a new tax on individuals who buy hotel rooms or say you know what, the tax is being paid and we're being in compliance.?
The bill backing the TDC almost died earlier this week.
Patronis says he doesn't expect a decision in the house for at least a week.
The State House of Representatives is currently entertaining two bills regarding taxes for online travel agencies.
One would allow Florida?s counties to collect bed taxes on the amount the customer pays for a hotel room.
The other would formalize what's already happening, collections on the amount the on-line agency pays the hotel for the room.
Some feel charging tax on the total cost would amount to a service tax.
"Thank you for calling bookit.com" Sales reps echo at the BookIt.com headquarters in Panama City Beach.
And it?s becoming one of the largest on-line travel agencies in the southeast.
It competes with sites like Travelocity and Expedia.
If the one proposal that would make them pay taxes on the full amount of a hotel room were to become law, bookit.com officials say it would drastically alter the way they do business.
Bud Finlaw is the Founder and CEO of bookit.com and he says the tax would be detrimental to the company.
"As you raise prices, sales go down, so we feel like it will actually hurt tourism when prices go up because of the new tax that's been implemented? Finlaw says.
Tourist Development Councils across the state are on the other side of the issue.
They say the online travel agencies are already cutting into their bed tax collections.
Bay County TDC Director Dan Rowe says he's not looking for any money the online agencies didn't pay over the last few years.
But he does want the sites to start paying the bed taxes.
"We completely understand the position the online travel agencies are in. And they are a good partner because they do provide a service that is very important to the tourism community. But our position is, we want them to remit the full amount of the tax from this day forward? says Rowe.
Tom DiBacco is the Vice President of Bookit.com and is having a hard time understanding where the TDC is coming from.
"In the long run, they may win the battle but lose the war. They realize how important tourism is to Bay County, and at the same time they realize how important jobs are here. So why would you support anything that would go after your number one industry which is tourism and then one of your own which is here providing high paying jobs? DiBacco says.
The online agencies have found a friend in State Representative Jimmy Patronis.
He's sponsoring a bill that would exempt the agencies from paying taxes on the total cost of room rental.
Patronis says his bill will let everyone know where they stand.
"Try to create a policy that makes it clear, cut, and understandable for the department of Revenue to do their job. And that's whether to create a new tax on individuals who buy hotel rooms or say you know what, the tax is being paid and we're being in compliance.?
The bill backing the TDC almost died earlier this week.
Patronis says he doesn't expect a decision in the house for at least a week.
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