States Where OTAs Collect Revenue Tax on Behalf of Hotels
In certain States, online travel agencies (OTAs) like Expedia are required to collect and remit taxes directly to the State for reservations paid through their platforms. In these cases, hotels typically invoice the OTA for the total amount paid by the guest, minus the OTA’s commission. However, when this tax arrangement is in place, hotels should not apply taxes to the OTA invoice, as the OTA is responsible for remitting the applicable taxes.
If your hotel is located in one of these States and is using the VM Cloud PMS, you can update the tax-exempt setting directly in the system. For hotels using the VM Desktop PMS, you’ll need to gather the list of impacted rate codes and the tax(es) to be exempted, then contact the Visual Matrix Client Experience team to update the rate plan mapping in the channel manager interface.
As of 08/07/25, per our knowledge, the following States are concerned*:
| - Arizona | - Indiana | - Massachusetts | - Oregon | - Washington |
| - Colorado | - Kentucky | - New Jersey | - Pennsylvania | - Wisconsin |
| - Connecticut | - Louisi | - New York City | - South Carolina | |
| - D.C. | - Maine | - New York State | - Utah | |
| - Idaho | - Maryland | - North Dakota | - Virginia |
*Consult your state and local tax code regulations for confirmation or additional information.
Related Articles
Related Articles
Guest Credit Card swiped over the OTA Virtual Credit Card
It happens! But don't panic, the original credit card you need to use is still on file! This can occasionally happen during the check-in process. Instead of doing the check-in with the virtual credit card and going onto Folio B to save the guest's ...Tax a Tax using Fixed Fees (Cloud)
Taxing a tax typically involves imposing an additional tax on an existing tax/fee, often at different levels of taxation. This practice is utilized by governments or authorities to generate revenue or shape behavior. In Visual Matrix, taxes are ...Set Up Compound Taxes (Tax-on-Tax) in Visual Matrix (Cloud)
Some cities or counties require hotels to apply certain taxes not just to the room charge, but to the room charge plus another tax—commonly called a “compound” or “tax-on-tax” scenario. Visual Matrix doesn’t support this calculation directly, but ...Reservations Not Posting in Visual Matrix
When hotels states "online", it generally refers to an OTA: Expedia, Booking, Priceline, etc. But between the OTA and Visual Matrix, there is a Channel Manager that supports the link (Best Western, Synxis, Siteminder, Innlink, ...). If a reservation ...Communication between OTA and Visual Matrix PMS 🎥
? Watch Video What is a Channel? A Channel is a company or booking entity that provides reservations to a hotel. Channels can be of 3 types: - Online Travel Agency (OTA): These companies are online portals for customers to book travel and ...