Travel Agency Sales Tax Defeated in Ohio

by Robin Amster July 11, 2013

Ohio travel agents were instrumental in defeating state legislative proposals that would have cost them an estimated $4 million a year.

One measure called for reducing the state sales tax from 5.5% to 5% while broadening its tax base by including “travel agent services” in the sales tax.

Another proposal would have given Ohio cities and counties the power to impose hotel occupancy taxes of up to 10% on the service fees that agents charge clients. Both measures would have been included in the new state budget.

Success in other states
The Ohio action follows the defeat of state tax proposals in Minnesota, Tennessee and Virginia that would have applied to travel agency sales. The Virginia and Tennessee proposals also included taxing agents’ service fees on hotel bookings.

Just last week, a proposal in Washington state that would have increased taxes on agents’ commission earnings was defeated.

In all five states, ASTA members played a key role in beating back the measures. Ohio agents made phone calls, had personal conversations with state legislators, sent nearly 350 messages through ASTA’s online grassroots site and testified on the measures.

Agent testifies
Ohio agency owner Chris Seddelmeyer testified before a legislative committee. “The committee truly seemed to pick up on the concerns expressed; that was a pleasant surprise,” Seddelmeyer told Travel Market Report.

“Based on the number of agency businesses in Ohio, the tax proposal would have cost an average $14,000 for individual businesses. We have such a tight profit margin, we couldn’t possibly afford that,” said Seddelmeyer, owner of Seddelmeyer Travel Concepts in Lima and president of ASTA’s Mid-America Chapter.

“Will there be other challenges? Always,” she said. “We’re always sitting on the edge of our seats. But ASTA’s government affairs department is constantly watching all of the states.”

Next up: Louisiana
ASTA is now keeping a close watch on Louisiana where the governor is reportedly considering a proposal to expand the state sales tax to include travel agencies.

Travel Agency Sales Tax Thwarted in Three States