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County Executive Leopold Applauds Passage of Legislation Closing Tax Loophole for Travel Sites

Law could recoup $500,000 annually

Annapolis, MD (November 8, 2011) — County Executive Leopold today applauded the County Council for approving legislation that closes a tax loophole for online travel sites.

"This is an issue of tax fairness," County Executive Leopold said. "The County was collecting taxes based on the wholesale price paid for hotel rooms, rather than the retail price charged to online customers. I want to thank the Council for recognizing this disparity and closing this tax loophole."

Travelocity, Orbitz, Priceline and other Internet companies market and sell hotel rooms to customers online at discount rates. The approved legislation would require payment of the 7 percent hotel tax based upon the retail value of a hotel room. The change could generate about $500,000 annually.

County Executive Leopold will sign the legislation this week. It becomes effective 45 days from his signature.

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