Las Vegas Rejects Suit Against Online Travel Companies

ITSA ALERT:  January 27, 2006

Officials in Clark County, Nevada, the location of the leading US tourism destination, Las Vegas, rejected a request by two law firms to sue online travel companies (OTCs), many of which are ITSA members, for hotel occupancy taxes the law firms claim are owed, according to a report in the Las Vegas Sun.  A Nevada Department of Taxation opinion concludes that the OTCs are not subject to such taxes for their services — directly contradicting the claims of the law firms -- an opinion with which the Clark County Taxation Department Executive Director agreed.  In light of this opinion and the view of its own senior tax official, the complex nature of the issue and the dynamics of Las Vegas, and a previous decision not to pursue such a suit, Clark County reconfirmed its decision not to sue.

The report by the Sun.  on the County's decision, which details the above and also points out that the two law firms acknowledged they could reap millions in fees if they induced the County to sue, can be found at:

http://www.lasvegassun.com/sunbin/stories/sun/2006/jan/19/519990228.html?Richard%20Velotta