Rome files suit against Airbnb
♦ Cartersville, Tybee Island and Hart County also are partners in the class-action lawsuit.
On any given weekend in Rome, there are at least 50 residents renting out either a room or an entire home to visitors through Airbnb, according to City Attorney Andy Davis.
Each one of those rentals comes with a “service fee” instituted by San Franciscobased Airbnb, Inc.
Where all of those collected fees end up has become the basis of a federal lawsuit filed Friday by Rome, Cartersville, Tybee Island and Hart County. They’re seeking class-action status and more than $5 million in damages.
To Rome and the more than 600 Georgia cities and counties the suit claims are affected, at least a portion of those fees represent taxes due. Those governments have so far not been paid by Airbnb.
This comes on the heels of a similar class-action civil suit involving Rome against web-based hotel booking companies such as Expedia and Hotels.com.
Filed more than 15 years ago, that one took seven years to net a favorable ruling. But Rome began receiving back payments on those taxes beginning in 2012, according to City Clerk Joe Smith.
“As a result of that case and the growth of Airbnbs and other types of similar booking companies, cities and counties have been inquiring about the frustration of not having the hotel/motel taxes collected,” Davis said Monday. “Airbnb has failed to pay the municipalities the taxes.”
Rome has an 8% hotel/motel excise tax. Its ordinance defines “hotel” to mean “any structure or any portion of a structure including any lodginghouse, roominghouse,
dormitory, Turkish bath, bachelor hotel, studio hotel, motel, motor hotel, auto court, inn, public club or private club containing guestrooms and which is occupied or is intended or designed for occupancy by guests, whether rent is paid in money, goods, labor or otherwise.”
According to the lawsuit, the plaintiffs first sent a letter to Airbnb, Inc., five years ago, demanding they collect and remit applicable excise taxes due them.
Similar letters were sent out in January 2017 and again in January 2019. The defendants have never responded to either demand, the lawsuit claims.
“Defendants engage in deceptive, unlawful, unfair, and fraudulent business acts and practices by misrepresenting to consumers and owners that Defendants are displaying and collecting Occupancy Taxes, which in fact Defendants to not display or collect,” the suit claims.
Airbnb consumers and owners are paying the taxes, the suit contends, but “(d) efendants have created (and will continue to create) the likelihood of confusion with respect to the Occupancy Taxes due to the Plaintiff government recipients.”