Alachua County v. Expedia, Inc.

Summary

The Supreme Court of Florida reviewed whether the Tourist Development Tax applies to the full amount online travel companies charge customers for transient hotel reservations, including markup charges, or only the amount received by the hotel. The court answered the certified question in the negative, holding that the tax applies only to the transient rental rate established by and received for the hotel room. The court approved the First District Court of Appeal’s decision, while Justice Lewis dissented and Justice Pariente concurred in the result.

Holdings

1. The Tourist Development Tax applies only to the transient rental rate set by the hotel and does not apply to the markup charges or service fees that online travel companies charge customers for facilitating hotel reservations.
2. For purposes of the Tourist Development Tax and Transient Rental Tax, the relevant person exercising the taxable privilege is the hotel that rents the transient accommodation, not the customer or online travel company.
3. The Tourist Development Tax and Transient Rental Tax must be read in pari materia to fully understand the legislative purpose and operation of Florida's transient rental taxation statutes.

Questions Presented

1. Whether the total amount online travel companies charge customers to secure reservations for transient hotel accommodations is subject to taxation under section 125.0104, Florida Statutes.
2. Whether the Tourist Development Tax applies only to the transient rental amount set and received by the hotel or also to online travel companies' markup charges and service fees.
3. Whether the Tourist Development Tax and the state Transient Rental Tax must be read in pari materia in determining the taxable transaction.

Disposition

approved