Goodbye Columbus: Accommodation Taxes and OTAs

Abstract

In 2006, the community of Columbus, Georgia, filed a lawsuit over uncollected accommodation taxes aimed at online travel agencies [OTAs]. Defendants included companies such as Expedia and Orbitz. In retaliation for the lawsuit, the OTAs delisted the city’s hotels from their sites. Several years later, the lawsuits were settled and normalcy returned. The delisting period provided an interesting set of circumstances that allowed exploration of the power balance between OTAs and municipalities. It also provided, using nonexperimental “real-life” data, some insight into an issue that has received significant trade and academic attention—the influence of OTAs upon hotel occupancies and rates. The results provided should be of interest to communities and their tourism officials in disputes similar to that experienced by Columbus. Hoteliers, the third party caught in the crossfire of these disputes, will also find the research results of value.