The Wyoming Supreme Court has ruled that online hotel booking companies are subject to Wyoming's full sales tax on lodging services. Currently the state only gets a "tax recovery fee" from the hotels that is based on the lower negotiated rate a hotel agrees to with an online booking service, such as Expedia or Travelocity.

The Department of Revenue sought a rule change that would allow it to tax the full retail price charged to consumers. The companies appealed the rule change to the State Board of Equalization, which approved the rule. The Board delayed implementation of the rule pending further litigation.

The companies appealed to the Wyoming Supreme Court. The groups argued they should not have to pay the full taxes because they do not have physical presences in the state, nor do they do not provide actual lodging services.

The court issued the following statement: "The Wyoming Legislature intended to tax the entire amount an online company customer pays for the right to occupy a hotel room in Wyoming. The court also concluded that the sales/lodging tax statutes are constitutional and did not violate "The Internet Tax Freedom Act.""

Governor Matt Mead applauded the court's decision. He said, “Wyoming is a premier tourist destination. It is our second leading industry and no company in the industry should have an unfair advantage.”