VRBO Accounting: Incompetent or sleezy?

[Kenny McCarty]

Just in case you aren't aware, we are being charged a 3% processing fee on the taxes that are collected from VRBO's traveler service fee.  This has been happening for years.  I have been on the phone many times with support explaining why this is wrong.  They all think it is just fine.  Let's do some quick math here...

Here are my assumptions:

1 million listings - I know the number is higher
bookings/year per listing: 20 - I get 60/year
average traveler service fee $150 - mine average $400
tax rate: 5% - mine is 11.2%

How much money is Expedia making by not fixing this bug:

1 million listings x 20 bookings x $150 service fee = $3,000,000,000
Taxes on that revenue @ 5% = $150,000,000
Service fee on those taxes (3%) = $4,500,000/year

My assumed numbers are VERY conservative....so the overall amount is likely significantly higher. So this BUG is providing $4.5 million to Expedia's bottom line....likely much more. I wonder why they won't fix it?

Am I incorrect in thinking this is wrong?  Would love for someone to explain it to me.

[Paul Sandhu]

I think it to offset the credit card fees.