Chicago Wins Suit Against Three Big Online Booking Sites
The city of Chicago has won $29 million in its 10-year old case against Expedia, Hotels.com and Hotwire, according to the Chicago Tribune. The total represents the amount of occupancy taxes still owed by those companies for guest rooms booked in the city through their online travel sites between 2005 and 2014, according to Bill McCaffrey, the city's law department spokesperson.
During that period, McCaffrey told the newspaper, the websites were paying hotel taxes based on the amount they paid to hotel companies for the rooms, but not the markup they pocketed when selling to their customers. As of Jan. 1, 2015, the three sites began paying hotel taxes to the city on the amount they charged their customers for the rooms. Next year, Chicago expects to collect a total of $110 million in hotel taxes.
"We are pleased with this judgment, which represents 100 percent of the relief we were seeking," said Stephen Patton, the city's corporation counsel in a statement announcing the settlement. "This is the latest example of the city's ongoing efforts to enforce its taxing ordinance against companies that try to avoid paying the full amount due. This effort is even more important given the city's current financial challenges."