Accordingly to this article, if an online booking site (orbitz, priceline, travelocity, expedia, et al) sells you a room for $114, it is really charging you $100 for the room and $14 in local taxes. But, if they are only paying the hotel $50 for the room, they remit $57 ($50 plus 14% tax) to the hotel and pocket the other $7 that you paid to them for taxes!
Los Angeles has filed a lawsuit to try to collect the money. But, I'm not so sure its their money to get. Sounds to me like it our money! ...?
http://biz.yahoo.com/ap/050106/trave...html?printer=1
LOS ANGELES (AP) -- The city is suing Internet travel sites such as Travelocity.com and Hotwire for allegedly failing to pay millions of dollars in hotel room taxes.
The lawsuit filed last week in Superior Court said companies behind the sites improperly pay taxes only on negotiated discount rates they get for buying rooms in bulk. The sites then mark up the rates for online sales, collecting from consumers the 14 percent city tax on the higher price and pocketing the difference.
"The Web sites can't have it both ways," said Katie Buckland, a spokeswoman for City Attorney Rocky Delgadillo. "They can't charge consumers taxes based on retail price but give back to the city only part of the money."