Hotel Tax Returns Confidential in Pennsylvania

Apr 22nd, 2014

A Pennsylvania court recently denied a newspaper's request for hotels' tax returns, holding that the returns were confidential proprietary information.

Pennsylvania's Right-to-Know Law allows access to public records. Records in the possession of local agencies, such as county governments, are presumed to be public records. There is an exception for records that contain confidential proprietary information. "Confidential proprietary information" is commercial or financial information that is privileged or confidential, the disclosure of which would cause substantial harm to the competitive position of the person who submitted the information.

A newspaper sought information about hotels' county tax returns under the state Right-to-Know Law. Specifically, the newspaper sought tax records for all hotels in the county that paid the hotel tax between 2007 and 2011. The newspaper wanted yearly totals of the hotel tax remitted and occupancy data for each hotel. The tax returns showed the total number of occupied room nights, the hotel's gross receipts, and the amount of tax paid. The hotels argued that this information was confidential proprietary information.

The court ruled agreed with the hotels. The hotels kept the information confidential. Disclosing the information could cause substantial harm to a hotel's competitive position. Bulk buyers of hotel rooms could use the information to depress room rates. Other hotels could use the information to lower rates and take business away from the hotel that provided the information. The court therefore denied the newspaper's request for tax return information.