Hotel Cancellation and No-Show Fees Not Taxable in Arkansas

Thursday, June 29th, 2017

 
 
A hotel room.
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Arkansas
Hotels, Casinos & Resorts

The Arkansas Department of Finance and Administration recently ruled that hotel cancellation and no-show fees are not taxable.

The taxpayer was a hotel that contracted with online travel companies. The hotel charged separately stated fees for cancellations and no-shows.

Arkansas taxes the service of furnishing a guest room, suite, or other accommodation by a hotel to a transient guest. Online travel companies are not subject the sales or tourism tax for furnishing rooms to transient guests. They only pay tax on the contract fees they pay to the hotels located in Arkansas. Additionally, Arkansas ruled that cancellation, no-show, and other similar types of fees are not taxable. The fees are not taxable because, as long as they are separately stated from the charges for the rooms, the fees are not for taxable services such as furnishing rooms.

https://www.ttrus.com/sites/default/files/ar/Front%20Page%20News.pdf


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TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

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