Ok, I just read the link. I don't understand the problem. If a hotel agrees to special-rate price for hotel rooms with Priceline/expedia/travelocity, etc, the occupancy tax should be paid at the same percentage as if anyone else agreed to pay a hotel for a pre-negotiated rate. When hotel rooms are blocked off for a wedding or bat matzvah, the people who pay that rate pay the same % occupancy tax as those who pay any other rate for a hotel room.

Any profits Priceline or others make, should be taxed as corporate income.