Online travel booking sites are good for Florida
Carol Dover of the Florida Restaurant & Lodging Association complains about the “lost sales tax” when online hotel booking sites pay tax on the wholesale cost of the room and not the retail cost.
What she fails to note is that all of these online hotel booking sites aggressively advertise and promote Florida travel at NO cost to the state!
Whenever a hotel room is rented, the traveler pays a hefty room tax: the “head in the bed” tax. Where does that room tax go? That tax goes to local and state tourism boards to pay for advertising and promotion.
Instead of costing the state lost taxes, the online hotel booking sites actually help generate revenue for the state. Her salary is paid in part through the efforts of the online hotel booking sites, and it costs her nothing.
Before Florida legislators go off the deep end to raise taxes on these sites, look at what happened to California which recently enacted a state sales tax on online purchases. Amazon.com promptly shut down 20,000 California-based online businesses selling Amazon products through their sites.
Think about it Carol. There are 50 states with different taxing requirements. The bookkeeping nightmare would put more small businesses out of business. Add to that the possibility of COUNTY and CITY taxes and you will have shut down an entire industry.
The result? States that make it easier for online travel sites to do business will get the most free promotion from those sites, as well as the hotel room tax revenues.
<IMHO> Fred Jacobsen
- State Sales Tax Holidays This Week (suddenlyfrugal.com)
- Travelers pay fewer taxes in Florida and California (dontmesswithtaxes.typepad.com)
- Money tip: Travel agent may be best choice to plan trip (seattletimes.nwsource.com)
- Amazon’s Latest Tactic In An Old Fight (businessinsider.com)
- Amazon’s New Fault Line (fool.com)
- Online marketers hit hard by California’s new online-sales tax (mercurynews.com)
- New Hotel Room Tax for Online Travel Sites Will be Costly (nyconvergence.com)
- Congress joins Amazon tax fight; $24 billion in revenue at stake (dontmesswithtaxes.typepad.com)