Romanian hosts’ earnings threatened by draft bill

Romania: Romanian short-term rental hosts who list their properties on platforms such as Airbnb and Booking.com are facing a threat to their earnings due to a draft bill in the country’s government.

The bill that has been proposed by the government prohibits the promotion of non-registered and non-classified accommodation structures.

It has now been approved by the Romanian Senate without a debate taking place, through a process called ‘tacit adoption’.

The draft bill will also simplify the classification conditions for local tourism operators by handing over the responsibility for the procedure to local authorities.

At the same time, economists are warning any potential short-term regulations could have a negative impact on Romanian hosts who will have their revenue restricted.

Cristian Paun, economics professor at the Academy of Economic Studies in Bucharest, told Business Review: “Authorisation, registration, classification by the state represent barriers and additional taxes that will eventually be paid out of pocket by those who use such services.”

Under the draft bill, the economists are calling on the local government in Bucharest to find extra revenue streams to counter the expected losses of earnings, however it could also bring benefits to larger operators who face competition from smaller property management companies that ask for cheaper rates.