Florida’s Office of Attorney General has sued Expedia and Orbitz, claiming that the companies violated state law by failing to remit the appropriate amount of taxes on hotel sales.
The lawsuit states that while Expedia and Orbitz have been collecting taxes from consumers, they have been remitting taxes based on the wholesale rate the online sellers get from hotels, not the retail rate consumers pay.
Florida seeks a declaratory judgment that the defendants have been violating state tax law.
Municipalities have been filing this type of lawsuit against online agencies for the past few years, but Florida is the first state to sue online agencies over alleged tax revenue shortfall.
The attorney general’s office said it has been discussing the hotel tax issue with the Florida Department of Revenue since early 2008. Six Florida counties filed a similar suit seeking clarification on the laws applicable to county tourist-development taxes.
Click here to read a copy of the Florida attorney general's lawsuit.