Hawaii Supreme Court: Booking.com Has Standing to Challenge Online Rental Tax

• The Hawaii Supreme Court is reviewing whether booking.com has standing to challenge a state law taxing online rental bookings.
• The decision allows an out-of-state defendant to contest a Hawaii law, which could have implications for other companies operating in the state.
• The Hawaii Supreme Court accepted certiorari on October 1, 2025, and heard oral arguments on December 16, 2025, marking key developments in the ongoing litigation between booking.com and the state of Hawaii.
• Companies may need to reassess their compliance with state laws taxing online rentals as a result of this decision.
• The court's finding on standing raises questions about the scope of state jurisdiction over out-of-state defendants.

The Hawaii Supreme Court accepted the application for writ of certiorari on October 1, 2025, and heard oral arguments on December 16, 2025, marking key developments in the ongoing litigation between booking.com and the state of Hawaii.

The Hawaii Supreme Court is currently reviewing the case of booking.com v. Hawaii, which involves the question of whether the online travel agency has standing to challenge a state law taxing online rental bookings. This decision is notable because it allows an out-of-state defendant to contest a Hawaii law, which could have implications for other companies operating in the state. The Hawaii Supreme Court accepted the application for writ of certiorari on October 1, 2025, and heard oral arguments on December 16, 2025, marking key developments in the ongoing litigation between booking.com and the state of Hawaii.

The case at the heart of this controversy involves Hawai'i Administrative Rule § 18-237-29.53-10(a)(3), known as the “Commissioned Agent Rule,” which imposes general excise taxes on online transient accommodations or travel-related bookings. The rule requires companies like booking.com to collect and remit taxes on behalf of their customers, who are typically residents of other states or countries. This has raised concerns among industry players about compliance with state laws and the potential for double taxation. The court's decision in this case will likely have implications for other online travel agencies operating in Hawaii.

This ruling has significant implications for lawyers advising clients in the hospitality industry, particularly those involved in online rental bookings. As a result of this decision, companies may need to reassess their compliance with state laws taxing online rentals. This could lead to changes in business practices and potentially impact revenue streams. The court's finding on standing also raises questions about the scope of state jurisdiction over out-of-state defendants.

Lawyers advising clients in the hospitality industry should watch for potential implications of this ruling, which may impact their compliance with state laws taxing online rental bookings.

Source: Original reporting via Source