Both the Maryland state senate (30-16) and assembly
(89-52) voted Thursday to override Gov. Larry Hogan's veto on a bill that will
apply a 6% sales tax to service fees or markups that an “accommodations
intermediary” charges when booking hotel rooms in the state.
In the bill, an “accommodations intermediary” is defined
as “a person, other than an accommodations provider, who facilitates the sale
or use of an accommodation and charges a buyer the taxable price for the
The override has drawn the ire of ASTA and the Travel
Technology Association (TTA), travel industry groups that lobbied against the
“We can’t win every fight, but we are heartened by the response of our Maryland members to our multiple calls to action over the past year." — ASTA CEO Zane Kerby
“Today’s party-line vote is a clear signal to Maryland
taxpayers who demanded a new direction during the last election that many in
Annapolis didn’t get the message. With the override of S.B. 190, the
legislature once again caved to Marriott’s threat to move out of state and
voted to increase taxes on over 200 community travel agencies and countless
travel service providers,” said Philip Minardi, vice president of
communications and public affairs for the TTA, a trade group representing
online travel agencies and GDSs.
“Because of today’s vote, Maryland’s tourism
economy will pay the price. Maryland’s taxpayers who travel in-state will pay
for these taxes in the form of higher room rates.”
argued that the override will make Maryland less competitive with nearby states
in travel and tourism.
Zane Kerby, president and CEO of ASTA, said that the
travel agency group was “disappointed” by the override.
“We can’t win every fight, but we are heartened by the
response of our Maryland members to our multiple calls to action over the past
year — nearly 500 advocacy messages sent to legislators, as well as dozens of
phone calls and in-person meetings,” Kerby said.
Hotels lobbied in favor of the bill. In a statement
earlier this month, the American Hotel & Lodging Association pushed for the
veto because the bill “closes a tax loophole and ensures online travel
companies pay the state’s existing occupancy sales taxes.”
In a letter sent
to senators and delegates in Maryland, the AH&LA said the bill “would not
create a new tax, it simply ensures that all companies in the business of
booking hotel rooms remit existing sales tax in the same way."
Gov. Hogan vetoed the bill in May because the issue is
being litigated in Maryland Tax Court in the case of Travelocity v. the
Comptroller of Maryland.
Marriott did not immediately return a call for comment.