March 20, 2013
/PRNewswire/ -- Travel Tech: The Travel Technology Association applauds the wisdom of the
Senate State and Local Government Committee for voting "no" on Senate Bill 212, which would have created new taxes on brick-and-mortar and online travel services. Online travel companies (OTCs),
travel agents, anti-tax organizations, independent
hoteliers, business travelers, internet coalitions and other groups were among those who raised concerns about the impact of the proposal.
joins a number of other states in the last two years, including
that have considered and rejected similar taxes as unworkable and harmful to tourism and job creation. This marks the second consecutive year that the
Senate has recognized these taxes as bad policy for
. A federal court in
, also sided with the OTCs in 2012, holding they were already in compliance with
"We hope the bill supporters in
now recognize that they were led astray by interest groups looking to use public policy as a competitive tactic to impose new taxes on traditional travel agents and OTCs alike," said
, Chairman of Travel Tech. "OTCs and traditional travel agents are in the business of encouraging travel to places like
, which creates real jobs and real tax revenue."
The bills would have also imposed major compliance burdens for local businesses in Tennessee. Any Tennessee-based travel agent who used the fee-for-service merchant model for bookings and assembling travel packages would have had to take on the unprecedented responsibility of calculating and remitting the tax owed in multiple taxing jurisdictions. These added compliance costs would have placed particular strain on traditional brick-and-mortar travel agents, who already operate in a business climate marked by extremely low margins.