Most Airbnb hosts dodging bed tax
Hotels and motels worried that they will have to pick up the tab
Two-thirds of Airbnb hosts in Auckland have dodged a new bed tax because the council cannot track them down.
And the number of them paying the full amount for running a business out of their home has plummeted — leaving hotels and motels concerned that they will have to pick up the tab.
Since August, homeowners who rented out their whole property or a guest-house on websites like Airbnb or Bookabach for more than a month each year were charged the new targeted rate, also known as a bed tax. They were also rated like a business rather than a residential property.
The council said the tax would capture around 3800 out of around 8000 Airbnb properties.
But as of December, the council has only been able to track down 1278 of these properties — around 33 per cent.
“The others have yet to be discovered,” said Auckland Council principal advisor financial policy Aaron Matich.
“The council is still looking for online accommodation providers and when found they will be charged according to the policy.”
Airbnb and other websites refused to share information about hosts on
privacy grounds. As a result, council officers had to scour accommodation websites for property listings.
Matich conceded that the new policy had encountered some difficulties.
“We will look to review our implementation approach over time. At this stage, our primary approach is to identify online accommodation providers through online listings. We will be undertaking further work on this in the first half of [this] year.”
When the rates bills were posted, the council said more than 800 online accommodation providers were renting out their properties for more than half the year. That meant they would be charged the maximum — full business rates and the full bed tax.
However, the council’s updated figures show just 162 providers were renting out their homes for more than half the year.
Matich said this was because the council’s default position had been to charge the full rate. If it received information which showed that the hosts were renting out their properties for less than 180 days, the rate was reduced.
Tourism Industry Association chief executive Chris Roberts said it was “quite astonishing” how few Airbnb hosts were now paying full rates.
Roberts said he was concerned that hotels and motels would have to make up the difference by paying more in next year’s rates.
“The more properties paying, the less each property will pay.”
Matich said online accommodation providers only made up a small portion of the revenue — around $870,000 or 6 per cent of the total. Despite the problems it had encountered with the bed tax, he said the council still expected to meet its budget for the 2018/19 year.