Opinion on Whether a Government Employee Performing Travel Incident to Official Duties is Subject to State and Local Lodging Taxes

An opinion was requested on whether a government employee performing travel incident to his official duties is subject to State and local motel and hotel taxes. The fact that the Government is obligated to reimburse the employee for his travel expenses and thereby assumes the economic burden of the tax does not in general make it a tax upon the United States. In general employees of the Government are not legally exempt from the payment of State and local taxes levied upon motel and hotel rooms. However, it may be noted that GAO is aware of five localities which permit an exemption from hotel and motel occupancy taxes when Government employees travel on Government business. Those localities are Baltimore, Maryland; Cleveland, Ohio; Los Angeles, California; New York, York; and Virginia Beach, Virginia.