Massachusetts House Passes Bill to Tax Short-Term Rental Hosts
In an effort to regulate the booming industry led by Airbnb, lawmakers want a tiered taxation system based on the number of rental units a host lists.
It could soon be more expensive to rent out that spare room of yours.
In an effort to regulate the blossoming short-term rental market in Massachusetts, the state House of Representatives passed a bill Thursday to tax property owners who list lodging on sites like Airbnb and HomeAway. Hosts would be taxed in tiers based on how many units they offer—the more units, the higher the rate. Professional managers with at least six rooms up for grabs would face an 8 percent tax per rental, according to State House News Service. Lawmakers also want to create a publicly-available registry of short-term listings and give the Department of Revenue the option to charge hosts to be included in the database.
Despite the popularity of short-term rental options among tourists and property owners, some argue that Airbnb listings have changed the fabric of their neighborhoods by scooping up affordable housing, and the hotel industry takes issue with losing revenue to a less-regulated market. The House bill, which passed 117-30, seeks to address the short-term rentals that have “created drastic inequities in the overall lodging market and [have] added to the housing crisis in some of our big cities,” Rep. Aaron Michlewitz, who helped write the bill, told State House News.
In addition to state-imposed taxes, the bill would also allow cities and towns to impose their own fees on hosts and investors. Should a municipality opt to move forward with such a tariff, they would need to also adopt a policy that requires short-term rentals to pass a safety inspection paid for by the host.
For its part, Airbnb is not thrilled by the proposal. The rental site said the bill was “onerous and overly burdensome,” according to State House News.