ARTICLE
BOSTON, MA – April 14, 2017 – As Bay Staters face today’s deadline for filing their taxes, AirbnbWATCH Massachusetts released an infographic (attached) representing a tax invoice addressed to Airbnb for millions of dollars of unpaid taxes. The infographic also calls out Airbnb for seeking “what no other business gets: to set their own tax rate without any oversight or transparency.” The infographic also highlights Airbnb’s push via Sen. Eric Lesser’s bill, S.1553, for a “voluntary collection agreement”, a widely criticized method of tax collection and remittance that Airbnb literally invented and that no other company is allowed to negotiate. Unfortunately, because Airbnb refuses to release information or auditable data about the scope and scale of its operations, it is hard to verify whether Airbnb’s secretive voluntary tax collection agreements meet the threshold for taxes owed. In addition to allowing Airbnb to obscure its tax liability, this lack of transparency also makes it impossible for regulators to enforce consumer protections including for health, safety, and civil rights. Many public officials around the country have seen through Airbnb’s scheme. Hawaii Gov. David Ige vetoed Airbnb’s attempt to rely on a voluntary collection agreement in his state saying, “The use of an intermediary as a tax accommodations broker also provided a shield for owners who choose not to comply with county laws, and this was a big concern of mine.” The Miami Herald reported that when Monroe County, Florida received the voluntary tax agreement proposed by Airbnb last year, the county Tax Collector Danise Henriguez expressed frustration stating, “They want to send a lump sum every month and have us accept that. I would lose total control. How do we know if they're remitting the correct amount of tax? Are these units in areas where they are legally allowed to rent? Do they have a homestead exemption? I don't know." Former Montana Department of Revenue Director and Multistate Tax Commission executive director Dan Bucks recently wrote that these agreements, the details of which are typically negotiated behind closed doors, are designed to “provide a shield of secrecy for lodging operators that prevents their discovery by public agencies and creates a de facto tax and regulatory haven for those operators.” The language in S.1553 explicitly relieves Airbnb, a company valued at over $30 billion, of any liability in the event their hosts misrepresent facts “about the nature of the property being rented, the duration of the occupancy or other similar representations made by the operator to the hosting platform or operator’s agent.” In other words, the Senate bill allows Airbnb to enter an agreement that allows them to mask illegal hotel operators to prevent their detection, and then relieves Airbnb of any liability if those operators cheat the people of Massachusetts out of owed taxes. Contrary to their rhetoric, this does not sound like the good corporate citizenship Airbnb claims to aspire to. Massachusetts lawmakers should see through Airbnb’s cynical rhetoric and insist that Airbnb is held accountable for taxes owed in the same way all other business are. ABOUT AIRBNBWATCH MASSACHUSETTS AirbnbWATCH Massachusetts is the local affiliate of AirbnbWATCH.org, a project of American Family Voices which brings together a collection of organizations dedicated to protecting communities and travelers by exposing commercial operators who use sites like Airbnb to run illegal hotels in residential properties under the radar by making sure all hotel businesses play by the same rules.
BOSTON, MA – April 14, 2017 – As Bay Staters face today’s deadline for filing their taxes, AirbnbWATCH Massachusetts released an infographic (attached) representing a tax invoice addressed to Airbnb for millions of dollars of unpaid taxes. The infographic also calls out Airbnb for seeking “what no other business gets: to set their own tax rate without any oversight or transparency.”
The infographic also highlights Airbnb’s push via Sen. Eric Lesser’s bill, S.1553, for a “voluntary collection agreement”, a widely criticized method of tax collection and remittance that Airbnb literally invented and that no other company is allowed to negotiate.
Unfortunately, because Airbnb refuses to release information or auditable data about the scope and scale of its operations, it is hard to verify whether Airbnb’s secretive voluntary tax collection agreements meet the threshold for taxes owed. In addition to allowing Airbnb to obscure its tax liability, this lack of transparency also makes it impossible for regulators to enforce consumer protections including for health, safety, and civil rights.
Many public officials around the country have seen through Airbnb’s scheme. Hawaii Gov. David Ige vetoed Airbnb’s attempt to rely on a voluntary collection agreement in his state saying, “The use of an intermediary as a tax accommodations broker also provided a shield for owners who choose not to comply with county laws, and this was a big concern of mine.”
The Miami Herald reported that when Monroe County, Florida received the voluntary tax agreement proposed by Airbnb last year, the county Tax Collector Danise Henriguez expressed frustration stating, “They want to send a lump sum every month and have us accept that. I would lose total control. How do we know if they're remitting the correct amount of tax? Are these units in areas where they are legally allowed to rent? Do they have a homestead exemption? I don't know."
Former Montana Department of Revenue Director and Multistate Tax Commission executive director Dan Bucks recently wrote that these agreements, the details of which are typically negotiated behind closed doors, are designed to “provide a shield of secrecy for lodging operators that prevents their discovery by public agencies and creates a de facto tax and regulatory haven for those operators.”
The language in S.1553 explicitly relieves Airbnb, a company valued at over $30 billion, of any liability in the event their hosts misrepresent facts “about the nature of the property being rented, the duration of the occupancy or other similar representations made by the operator to the hosting platform or operator’s agent.”
In other words, the Senate bill allows Airbnb to enter an agreement that allows them to mask illegal hotel operators to prevent their detection, and then relieves Airbnb of any liability if those operators cheat the people of Massachusetts out of owed taxes. Contrary to their rhetoric, this does not sound like the good corporate citizenship Airbnb claims to aspire to.
Massachusetts lawmakers should see through Airbnb’s cynical rhetoric and insist that Airbnb is held accountable for taxes owed in the same way all other business are.
ABOUT AIRBNBWATCH MASSACHUSETTS
AirbnbWATCH Massachusetts is the local affiliate of AirbnbWATCH.org, a project of American Family Voices which brings together a collection of organizations dedicated to protecting communities and travelers by exposing commercial operators who use sites like Airbnb to run illegal hotels in residential properties under the radar by making sure all hotel businesses play by the same rules.