EXCLUSIVE: State seeks an $15M in back taxes from online travel - Hawaii News Now - KGMB and KHNL

EXCLUSIVE: State seeks an $15M in back taxes from online travel websites

(Image: Hawaii News Now/File) (Image: Hawaii News Now/File)
Image: HawaiiNewsNow / File Image: HawaiiNewsNow / File
Image: HawaiiNewsNow Image: HawaiiNewsNow
Image: HawaiiNewsNow Image: HawaiiNewsNow
HONOLULU (HawaiiNewsNow) -

After paying the state of Hawaii more than $50 million in back taxes last year, the nation's largest online travel companies were hit with new multi-million tax bills.

According to the state, Expedia, Hotwire and seven other online firms owe another $15 million in general excise taxes for car rentals they booked in Hawaii dating back to the year 2000.

Small businesses say they are in favor of the state cracking down on the online companies.

"They do look at it as a fairness issue, they don't look at it like they have a brick and mortar operation here. They look at it like they are doing business and making money and in some cases they are taking business away from local businesses," said Republican state Sen. Sam Slom, who represents Hawaii Kai.

Court filings show that Expedia owes the most at $6.1 million, followed by Hotwire.com, which owes $2.6 million. Priceline.com was next at $1.7 million.

The assessments are the latest in a long-running legal battle with the online companies.

Three years ago, a state judge ordered the firms to pay $240 million for not paying Hawaii's hotel room and GE taxes. But that ruling was scaled back to $50 million by the Hawaii Supreme Court last year.

The latest tax bill is on top a $40 million assessment for rental car booking that the state issued in 2014. That tax was for revenues that the online companies received for car rental bookings. The new tax was for travel agency commissions they received from the rentals.

Attorneys for the online companies could not be reached but their tax appeal will likely be heard by a judge next year.

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