Why doesn't Airbnb provide a reasonable means for collecting occupancy taxes?

Jason22
Level 7
Lexington, KY

Why doesn't Airbnb provide a reasonable means for collecting occupancy taxes?

Airbnb says that they want to help hosts follow tax laws, yet no reasonable means is provide to collect taxes. How difficult would it be to add a user-defined percentage of the reservation and label it as taxes? Other sites (e.g., VRBO, HomeAway) have that option. Without it, I'm going to have to either (a) pay the taxes out of my own pocket, or (b) raise my Airbnb price so it appears to be higher than my prices on other sites to account for what will be a hidden tax.  I don't see how that's in Airbnb's best interest if all hosts have to raise their prices here to offset the inability to collect taxes in a strightforward manner.

Also, it's not fair that responsible hosts collect the appropriate taxes and others do not. It wouldn't be particularly difficult for Airbnb to figure out the correct occupancy tax in each city--at least in the United States, and perhaps major cities abroad--and automatically add it to each reservation based on the zip code of the property. I'd be no worse off in terms of reservations if I leave Airbnb in favor of other sites that make a reasonable effort to make collecting taxes easier for their hosts, and I don't see how that would be in Airbnb's long term interest if there's a mass exodus for the same reason.

Does anyone know why Airbnb is so hands-off about this issue? Where are the correct buttons to make these SIMPLE yet important things happen?

12 Replies 12
Clare0
Level 10
Templeton, CA

@Jason22  I agree 110% with you.  To add insult to injury, since I also pay out of pocket,  I'm being charged the 3% on the taxes I pay. 

And, since I pay out of pocket, my listing may seem more expensive than others.   Price Tips are a total joke....I'd go broke with their suggestions.  

One thing I've done recently is put in my House Rules (so it shows up in itineraries) that I pay the taxes on the guest's behalf. 

Exactly!!  VRBO collects and has options, but not AirBNB which doesn't offer the option even though they are lobbying for a bill in our state to collect the taxes on our behalf. 

 

Hawaii is very difficult as they require GET (general excise tax) and TAT (transient accomodation tax ) combined it is over 14.42% tax - that is huge!  Using the resolution money request option (as advised by airbnb) can create a negative suprise to guest that book (especialy if the guest does not see that this will be collected and not included in the price which is noted in BOLD on the property description).

 

Hawaii has STRICT short term rental rules and properties must be permitted (unless it was granted as hotel status when built). Its possible that airbnb does not want to get involved with tax collection as it would expose un-permitted units and housing.  This however puts property owners who play by the rules in a disadvantagous situation....

 

Airbnb can easily put this as an option for hosts...and should.

Deb0
Level 9
Mendocino, CA

I agree!! It's ridiculous that a huge, global lodging company ignores lodging tax for the majority of the world. They do have a handful of cities where they collect and remit the tax, but this is only due to dramatic political battles in those places so they were forced to do so. It would be easy for Airbnb to add a line item to the payment system so we can put in our percentage and collect nad remit the tax. Both VRBO and FlipKey have this option.

 

For my area, Mendocino County Code states we cannot fold the tax into the room rate and that the guest receipt must clearly indicate the taxes. Check out the Code for your area also, I'll bet it says the same thing. My solution has been to email a PayPal invoce to the guest immediately after booking. I have this clearly stated in my listing and so far it's worked well. It is more time consuming and every once in a while a guest complains but it's all we can do until Airbnb wakes up and realises we need an easy way to include these taxes.

 

I have spoken and emailed so many people at Airbnb about this over the past 3 years. I make sure to mention it to every customer service rep when I call in. I have also emailed with Chip Conley who referred me to Beth Adair, "Global Tax Director" at Airbnb. No progress. I encourage all hosts who comply with local taxes to contact Airbnb and demand they provide a way for us to collect them within the site.

Mark26
Level 10
Melbourne Beach, FL

AirBnB has begun to collect State Sales Tax and Transient Occupancy Tax in Florida. Unlike other sites that send those tax dollars to the host, AirBnB forwards the money to the state, in the form of one big check, that covers every rental made in the entire State of Florida through their website.  But...  They don't provide the State with any accounting of which hosts to credit with what amounts.  I spoke with AirBnB about this, and they wrote back to tell me that they wanted to protect my identity, and I needent worry, that they won't divulge that information.

 

Huh.....  ???

 

I checked with the State.  They told me that if I couldn't prove that AirBnB had collected the tax and forwarded it to them on my behalf... if I didn't have an accurate accounting of exactly how much of their great big check should go towards crediting my Sales Tax Account, that I would remain fully responsible for collecting and forwarding the appropriate taxes to the appropriate agencies.  AND they warned me that if I did not comply with the law (As we have for twelve years), they would go after us for back taxes, plus fines, late fees, and penalties.  

 

This does NOT make me comfortable at all.  AirBnB does a great job of connecting us with guests from around the world.  The boost they have given to our bottom line is very much appreciated. But their absurd methodology of dealing with Sales and Transient Occupancy Taxes is completely unwarranted.  It is so much easier to comply with State and Local regulations on any other advertising platform.  WHY they insist upon complicating things, and "Protecting our Identities" is beyond me.

 

PLEASE AirBnB...  We are Licensed and Registered with The State, The County, and Local Municipal Governments.  They even come out and inspect us on an annual basis.  We not only comply with all regulations, but we like it.  We're not hiding from anyone.  PLEASE... help us to operate within the law...  stop acting like a bunch of quasi-anarchists.  We are legitimate...  We don't wear Guy-Faulkes Masks, and "No Snitches" buttons.

I'm surprised by the problems being reported.  I have property in North and South Carolina. In both of those States Airbnb collects and remits the taxes on my behalf. In fact I was just complaining about VRBO and HomeAway. They do put a line and allow me to collect taxes but they do not remit them. I love the fact that Airbnb does that for me. On my North Carolina tax forms it asks how many nights I have rented from Airbnb and all I do is put that in and they match my property to the taxes

Unfortunately Airbnb only collects occupancy tax in select locations. I have been hoping /waiting since I became a host in 2013!

Airbnb only pays the SC state tax.  Do you not have local taxes as well?  In Greenville, we have to pay an additional 3% for the local tax.

I'm in the process of trying to determine this also. I'm new to airbnb but not to my cabin rental business. I file my sales taxes monthly, which is 10% total (state, local, tourism taxes). If Airbnb collects it for me (and they are collect too much) but they do not give it to me, I have no idea what I'm supposed to do when I file sales taxes. I called airbnb to ask, and after 20 minutes, the person on the other end still did not understnd my question. I asked to speak to someone else and I just received an email referring me to income tax info rather than sales tax/occupancy tax.

Mike404
Level 1
Olympic Valley, CA

I have the same issues as people have stated.

 

Does anyone have a good way of collecting the extra tax and not scaring away guests?

 

For example: I could send a special offer to guests. But then I may lose that opportunity. And the "special offer" mechanism requires me to first reject the initial offer. So not all guests will accept that.

 

I read about sending a paypal invoice after theuy checkout. Seems like most people would not pay.

Mike...your best bet is to request the money through the Resolution Center.  This has worked for me 100% of the time.   I never had a guest refuse to pay the 14.416% combined GET and TAT taxes for Hawaii, probably because these monies are specifically requested in the main body of my listing.  My listing states these taxes are not included in the room rate...it's not worded to frighten away guests, but it makes it clear the guest is responsible for them if they continue with the booking.  Guests are very good about paying the taxes...There have been a few instances where the guest took several weeks to pay them, but the funds were received prior to their departure date, so I was fine with that. 

 

The additional monies can be requested immediately after the guest books but for the request to be valid, the reservation must be paid in full.  That brings me to the only downside of the resolution center: when a guest doesn't pay their reservation in full, the request for the additional monies can't proceed.  This situation requires some follow-up from you as a host: ensure that the request goes to the appropriate guest when it is finally paid in full; and the guest makes the additional payment via the method of their choice.  You will get an email from Airbnb as to the progress.  For example, I get an emaiI that I requested money for the resolution center and then I get an email shortly thereafter that the guest has agreed to paying the additional amount.  I usually check about two weeks before the guests' departure date (usually the booking is paid in full by this point).  If not, wait another week or so then request it again.  Hope this helps.

Jason I agree totally, being a new host it has been very frustrating dealing with this matter..our ordinance states host can not pay out of pocket..lose -lose....and if i raise my prices to accommodate the tax, guess what ..your gross receipts just went up your paying the tax on..ready to bag it all..Barbara