Wednesday, January 5, 2005

LA Sues Orbitz, Cheap Tickets, Others Over Hotel Tax

Los Angeles has sued online travel sites Orbitz, Priceline.com, Cheap Tickets, Travelocity, and Expedia, claiming that the hotel booking services underpaid the city's hotel tax, according to a report by Reuters. In a lawsuit filed in Los Angeles Superior Court, the city apparently claims that online travel companies underpaid the hotel tax by receiving discounted room rates from hotels and selling them for higher prices to customers. Hotel tax is paid on the discounted room rates, instead of on the actual price paid by customers.

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