COLUMBUS, GA (WTVM) - For the third time in a year, the Georgia Supreme Court heard a case dealing with a municipality versus an online travel company. Monday, it was Hotel.com versus the City of Columbus.
Once again, at issue is a lower court injunction dealing with how the site collects and remits taxes to Columbus.
"This is strictly and issue of whether or not when a consumer pays a portion of the tax, the OTCs can keep it or remit it to the city," explains C. Neal Pope, one of the attorneys representing the city of Columbus.
Pope says the city isn't getting its fair share of tax dollars, money that would be used to support tourism in the community.
They say the tax is being collected on a discounted or secret "net rate" that's negotiated between the travel site and hotels, rather than on what the consumer pays.
"The transaction that is applicable, here, the one that we need to look at and consider is the one the consumer, the ultimate taxpayer is involved in and that is the one with hotels.com," explained attorney Wade Tomlinson in his arguments in front of the justices.
Meanwhile, attorneys for hotels.com once again explained and defended its business model and they say the company has done exactly what it's supposed to do.
"It collects money, some of which will pay lodging charges to a hotel, some of which will pay taxes on the lodging charges, some of which will be retained and that's a service charge, which under the statute is not subject to tax in this state," said attorney E. Kendrick Smith during his oral argument.
The court first heard the case of Expedia v. the City of Columbus, in which it has not issued an opinion.
The outcome of that case will likely determine the fate of this one.