Georgia communities file tax suit against Airbnb
US: Four communities in the state of Georgia, three cities and one county, have launched lawsuits against Airbnb demanding additional tax revenue.
Rome, Cartersville, Tybee Island and Hart County have collectively filed their suits, alleging hundreds of communities may be affected.
Each case has been filed individually at the moment, waiting for a judge to rule on whether or not the four parties may form a class action suit with the additional affected communities. The suits allege that Airbnb failed to provide jurisdictions with local excise taxes, in spite of its own terms of service saying the taxes are taken from both hosts and guests.
They demand an injunction to force the company to collect and remit taxes across the state, though the amount has not been specified. They further seek a declaratory statement that Airbnb’s business practices are illegal and deceptive.
Airbnb has not yet commented as of Tuesday this week.
The two law firms representing the communities have experience with this type of suit, with the Georgia Supreme Court demanding Hotels.com, Hotwire, Orbitz, Priceline and Travelocity both collect and remit local taxes. $18 million of funds have thus far been taken since the suit was settled.
Atlanta attorney Robert Lamar said his firm offered the same deal to Airbnb but was rejected.
Airbnb notably does not have an arrangement with Georgia’s government to collect taxes automatically. The state recently signed into law a measure facilitating the collection of state and local sales tax from online providers.
The ordinance comes into effect on the first of April and has inspired other state lawmakers to propose additional digital tax measures as well.
Counties and municipalities across the US are seeking greater control over their short-term rental markets. Honolulu has begun investigating public satisfaction with online rentals, and Boston has updated its legislation to remove short-term rental loopholes.