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State Sales Tax and BOI Changes: What 2025 means for U.S. Travel Advisors

Nebraska and Louisiana show how state sales taxes could reshape travel-advisor fees, while new BOI rules ease federal reporting. Here’s what to watch in 2025.

BRANDUSA

8/28/20255 min read

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green car on brown field during sunset

Two Compliance Fronts for U.S. Travel Advisors in 2025: State Sales-Tax Expansion vs. BOI Rollback

Summary: States are exploring (and sometimes abandoning) new sales taxes on services that could capture travel-advisor fees, while the federal BOI regime was rolled back for U.S. companies in March 2025. Here’s what changed and what to watch next.

1) What just happened in Nebraska and Louisiana, and why it matters nationwide

In Nebraska, a proposal to tax travel sold in-state, effectively adding up to 7.5% to trips booked via Nebraska advisors, was defeated after heavy industry pushback. ASTA warned a $3,500 cruise could have carried ~$262 in extra tax, and consumers could simply book with out-of-state advisors to avoid it. That competitive distortion risk resonated with legislators, and the measure luckily died.

In Louisiana, the governor’s broader tax overhaul contemplated expanding the sales-tax base to services; following a special session and advocacy (including ASTA), lawmakers did not impose a new sales tax on travel advisors’ services. It’s a reminder that service-tax ideas are live but even if not always enacted on first pass.

Why this matters: once one state successfully broadens the base to include professional services, copy-cat bills often follow. Travel advisors become collateral in revenue debates framed around “taxing services” generally, unless trade groups carve out exceptions in time.

2) States to watch: 2025 proposals and signals

  • Maryland: 2024’s HB1515 would have cut the rate to 5% while expanding tax to many services; similar ideas resurfaced in 2025 targeting selected business-to-business services. Even when travel services aren’t named, broad “service” language can sweep advisors in.

  • Minnesota: administration proposals in 2025 included expanding the base to services like legal/accounting/brokerage while nudging down the rate

  • New Jersey: 2025 budget materials discussed extending sales tax to additional services/transactions—illustrating how “partial service taxation” can grow over time.

Takeaway: Even when a bill doesn’t mention “travel,” generic service-tax expansions (plus sourcing rules) can land on advisor service fees and, in some models, bundled package charges.

3) Practical implications for advisors

  • Sourcing & arbitrage: If tax applies where the advisor is located, in-state advisors become pricier than out-of-state competitors overnight (Nebraska’s risk case). If tax applies where the consumer is located, multi-state compliance kicks in.

  • Model matters: Merchant-of-Record (MoR) vs. agency-of-record structures can shift who’s on the hook. Expect differing treatment for professional fees, service charges, and bundled packages under each state’s definitions.

  • Local layers: City/county overlays (and other taxes like B&O in some jurisdictions) complicate the stack; monitor local notices alongside state statutes.

4) Meanwhile, BOI reporting changed (a lot) in 2025

The irony of 2025 is that the compliance battle everyone was bracing for—Beneficial Ownership Information (BOI) reporting—has largely disappeared for U.S.-formed businesses

On March 21, 2025, FinCEN issued an interim final rule removing BOI reporting requirements for U.S. companies and U.S. persons under the Corporate Transparency Act. The definition of “reporting company” was revised to focus on certain foreign entities registered to do business in the U.S., with new 30-day timelines for those foreign reporting companies. For most U.S.-formed businesses, the much-debated BOI obligation was rolled back.

That rollback is good news. But it shifts the spotlight squarely to state sales-tax exposure, which is harder to track, fragmented across 50 jurisdictions, and far more likely to hit advisor margins in practice. Federal rules can be studied and applied once; state tax is dynamic, political, and inconsistent.

In other words, BOI was a one-time headache. State sales taxes could become an ongoing competitive disadvantage. If Nebraska had passed its bill, advisors there would have been immediately more expensive than out-of-state competitors. That risk hasn’t gone away—it has only been postponed.

Net effect for advisors: BOI is no longer the main federal compliance headache for U.S.-formed agencies; state sales-tax exposure now looms larger in 2025 planning.

5) Action plan (what to do this quarter)

Travel advisors cannot afford to sit back and assume “it won’t happen in my state.” Even proposals that die in committee shape the next round of bills. The smart move is to act as if service taxes are coming and plan accordingly.

Practical steps to take this quarter:

  1. Map your exposure: List your fee types (planning fees, change fees, consultation) and where you serve clients. Tag states with active or recent service-tax debates (e.g., MD, MN, NJ) and states with live travel-specific discussions (e.g., NE, LA).

  2. ASTA engagement: Keep your state delegation contact info ready; industry coalitions have proven effective at stopping poorly scoped bills (Nebraska/Louisiana).

  3. Contracts & invoices: Separate taxable advisor services (if any) from non-taxable pass-throughs on invoices to avoid “tax pyramiding.” (Maryland debates flagged this risk explicitly.)

  4. System readiness: Ensure your PMS/CRM/accounting can toggle service tax by state and source transactions correctly (advisor location vs. client location).

  5. BOI check: If you’re a U.S.-formed entity, document the March 21, 2025 BOI change in your compliance file; if you operate through foreign entities registered in the U.S., verify whether the new foreign-company deadlines apply.

6) Outlook: what Antravia will watch

The sales-tax issue is not going away. If anything, 2025 will see more states test the waters. Some will fail, others will pass, but eventually one state will break the dam which will set a precedent for others to follow.

The lesson from Nebraska and Louisiana is that advocacy works. When travel advisors organize, they can push back. But the bigger risk isn’t the legislation that makes headlines, it’s the quiet amendments buried in larger tax reform bills that advisors don’t notice until the law is signed.

This is where Antravia comes in. Our job is to monitor these shifts, translate legal changes into financial impact, and prepare advisors so they aren’t blindsided. Federal compliance just got lighter with BOI. State-level compliance is where the real margin risk now sits.

For travel advisors, the choice is simple: watch from the sidelines and hope your state isn’t next—or plan now, align with industry bodies, and keep your business model one step ahead of the taxman.

  • “Base-broadening” bills that lower the rate while adding more services (Maryland/Minnesota models).

  • Travel-specific amendments that could explicitly capture advisor fees (Nebraska-style).

  • Local harmonization (e.g., cities updating model ordinances for service taxation).

References


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