January 4 - Maryland Senate Bill 190 Represents Dangerous New Tax on Business Travelers

Meetings Will Be Moved To Neighboring States Should Governor Hogan’s Veto Be Overridden

The Business Travel Coalition (BTC) today strongly cautioned Maryland lawmakers not to play politics with the state’s travel economy by overriding Governor Hogan’s veto of SB190, a new sales tax on fees for services provided by travel agencies in the booking of hotel rooms. This new tax would be passed on to corporate, university and government travel departments along with travel agencies’ significant new costs for legal obligations and accounting complexities, compliance requirements and audits.

“Travel and meeting managers, including state government travel offices and state universities, are under great pressure to watch every penny of travel spend. All of these administrative costs would be on top of the new tax and would be translated into higher transaction fees from the travel agency to the travel department,” stated BTC Chairman Kevin Mitchell. “As such, a double incentive would have been created to choose a less expensive destination than Maryland, if possible. If not possible, there would be less money to spend in Baltimore or Annapolis on restaurants, entertainment and other destination services adversely impacting jobs and economic activity,” added Mitchell.

Not only would this bill result in downward pressure on demand for lodging properties of all sizes, it would do harm to Maryland’s 1,100 travel agencies most of which are small businesses endeavoring to scratch out a living for themselves and their employees. Smaller agencies simply do not have the infrastructure to handle these kinds of requirements and many would not be able to compete with larger agencies that do. So, the playing field would get unfairly tilted in favor of the largest agencies.

BTC expects legislators will understand very well the incentive new taxes and administrative costs would provide organizations to reconsider the great state of Maryland as a business travel destination.


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