Travel firms must pay state GE tax

Online travel companies could owe the state millions of dollars in penalties, interest and unpaid state taxes in connection with car rentals in Hawaii, the state attorney general’s office said in a news release.

Circuit Judge Gary W.B. Chang ruled Friday that online travel companies — including Expedia, Priceline, Travelocity, Orbitz and Hotwire — must pay Hawaii’s general excise tax on certain car rentals in the islands. The state had issued assessments of general excise taxes, interest and penalties to online travel companies for failing to file tax returns and pay taxes from 2000 through 2012.

Chang upheld the state’s tax assessments on gross receipts from online car rentals that were not part of a travel or tour package. In addition, Chang found the companies owe GE taxes on their net receipts from car rental transactions that were part of a package.

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Star-Advertiser staff