Diplomatic tax exemption cards are valid nationwide at the point of sale. To fully derive the benefits of this privilege, the cardholder must exercise a certain degree of planning.
Since hotel bills are the most common source of problems, cardholders must make reservations and notify the hotel of their tax-exempt status in advance.
Official/Mission Hotel Tax Exemption – OFM considers official expenses associated with the lodging of employees of foreign missions, representatives of a sending State’s government, or other travelers hosted by the foreign mission, to be exempt from taxation when:
a) the foreign mission holds a valid Mission Tax Exemption Card that allows for the relief of such taxes; and
b) the travel of the individuals described above is conducted in support of the mission’s diplomatic or consular functions; and
c) the lodging costs are paid for with a check or credit card in the name of the foreign mission.
OFM will not authorize any foreign mission’s “official” request for tax exemption on lodging expenses that are unrelated to a mission’s diplomatic or consular functions, such as those related to tourism or leisure travel.
Personal Hotel Tax Exemption – OFM considers the personal lodging expenses of individual members of foreign missions or their immediate family members to be exempt from taxation when:
a) the individual holds a valid Personal Tax Exemption Card that allows for the relief of such taxes; and
b) the room(s) are registered in the name of the individual to whom the Personal Tax Exemption Card is assigned; and
c) the lodging expenses are paid for by the individual to whom the Personal Tax Exemption Card is assigned, using any form of payment.
Cardholders may find themselves in the position of informing hotels and other vendors of their tax exemption privileges. The cardholder is entitled to politely but firmly insist on tax exemption in all cases. Cardholders should continue to assert their right to exemption from hotel and sales taxes in all states, and may further offer the innkeeper or vendor a copy of the Department’s Diplomatic Note 08-71 (dated October 20, 2008) as additional explanation of the tax exemption program. They may also offer a copy of OFM’s The Diplomatic Customer publication (available on OFM’s website) or the cardholder may present to the vendor their Tax-Exemption Assistance Card. In addition, during normal business hours, they may ask to directly contact OFM by telephone at (202) 895-3500 x 2, or the nearest OFM Regional Office (Chicago, Houston, Los Angeles, Miami, New York City and San Francisco).
Cardholders should allow sufficient time to resolve tax exemption questions at hotels. A cardholder who checks out of a hotel at the last minute under pressure to make an airline flight or business meeting may not have sufficient time to obtain tax exemption, since the question is often referred to the hotel management, local government authorities, or OFM.
Foreign missions are advised that hotels and state or local governments have the right to request documentation, and to seek OFM’s opinion and advice, before agreeing to extend an exemption from a lodging or occupancy tax.