US: Airbnb has begun collecting a six per cent West Virginia state sales tax on behalf of its host community across the state.
Such regulations have been enforced to ensure that traditional hospitality providers and large hotel corporations benefit from home-sharing in the state and gain new revenue streams. So far, Airbnb has partnered with more than 400 local governments across the United States to facilitate the collection and remittance of taxes.
Some states have also started to pass laws which authorise platforms like Airbnb to collect taxes themselves.
As a result of the latest law to be imposed, Airbnb will automatically collect and remit the sales tax for taxable bookings across the state, making the process more seamless for local Airbnb hosts to deliver a fresh revenue stream to the state. The firm will deliver that to the West Virginia State Tax Department.
This tax revenue delivery follows the signing of a bill into law earlier this year which protects the rights of West Virginia homeowners to share their homes as vacation rentals or short-term rentals. SB 4, which made the municipal home rule pilot programme permanent, says that cities which participate in the programme are forbidden from imposing laws that “prohibit or limit the rental of a property or regulate the duration, frequency or location of such rental”.
Speaking to Huntington News, Airbnb regional policy director Tom Martinelli said: “We are eager to get the word out about this tax collection so that hosts who are already collecting the sales and use tax know that this responsibility will now be handled by Airbnb on their behalf.
“West Virginia is leading the way on embracing the economic benefits of the sharing economy. The home-sharing protection law Governor Justice earlier signed into law will support increased tourism to the state, and our ability to collect state taxes will bring new revenue,” he added.
Last year, Airbnb announced the firm’s most popular listings in a report detailing each of the top 25 home-sharing markets in West Virginia. The list can be accessed here.
Furthermore, the company revealed that its West Virginia host community had earned a combined $10 million in supplemental income in 2018 while welcoming up to 90,000 guest arrivals to the state. However, the data collected suggested that Airbnb and its host community were actually complementing rather than threatening the hotel industry.
A recent report published by the West Virginia Tourism Office points out that West Virginia hotels experienced dynamic growth in occupancy, nights sold and overall revenue in 2018, even as local hosts attracted guests in the tens of thousands.
That would seem to indicate that Airbnb is broadening the reach of prospective tourists to the state to include travellers who are less likely to pay for a hotel stay, those who prefer to stay in neighbourhoods or cities that lack hotels, and families who prefer to stay together in the same place.