Airbnb announces it will collect and remit local tourist taxes where they apply in Italy according to the new law which comes into effect on 15th February.
This new Italian legislation mandates platforms like Airbnb to collect and remit tourist taxes in Italy, effective from Thursday, 15th February. Airbnb has announced its compliance, starting with over 1,200 towns and cities across the country.
Under this law, Airbnb will calculate the tourist tax for eligible stays based on the local rate at the listing’s location. For instance, in Venice, it ranges from €1 to €5 per night, while in Rome and Milan, it varies from €3 to €7 and €2 to €5, respectively.
The company stated, “We will automatically collect the required amount for each stay and remit it in full to the local authority on a routine basis, following local regulations.”
Furthermore, Airbnb has committed to adhering to new national regulations governing short-term rentals, including the establishment of a national registration system. Data gathered through EU-wide guidelines will reinforce the regulations, supporting home-sharing platforms like Airbnb.
Not related to tax evasion fine
It’s important to note that this tax collection and remittance initiative is distinct from Airbnb’s tax settlement of $620 million with Italy in December. The settlement addressed the company’s failure to withhold taxes from landlords’ rental income.
In a separate incident, an Italian judge ordered the seizure of €779.5 million from Airbnb’s Ireland unit for alleged tax evasion, relating to the company’s failure to withhold 21% of landlords’ rental income and remit it to Italian tax authorities from 2017 to 2021.
While Airbnb settled the tax dispute without admitting liability, it disclosed in a financial filing that it does not intend to recover tax withholdings from affected hosts for audited periods. However, the company seeks information on hosts’ taxes paid for 2022 and 2023.
Government to tighten measure on short-term rentals
To address concerns regarding tax evasion associated with short-term rentals, Italian Premier Giorgia Meloni pledged to tighten measures, proposing an increase in the tax rate for owners from 21% to 26%.
As of the third quarter of 2023, Airbnb has generated over $9 billion in tax revenues globally for authorities, with more expected in the future.
Additionally, Amsterdam plans to raise its tourist tax on short-term rentals and hotel rooms to 12.5% in 2024, making it the highest tourist tax rate in Europe. This increase from the current 7% is likely to result in a significant rise in nightly costs for visitors.
On 9th February, AirBnB released a statement saying, “Today, Airbnb is pleased to share that we will collect and remit tourist taxes for short-term rentals in all parts of Italy that have a tourist tax system in place. The entire tourist tax process will now be fully automated, so visitors to Italy can focus on enjoying their stays without the worry of tax bills and paperwork and Hosts can prioritize making guests feel at home.
Our work to collect and remit tourist taxes across Italy follows a change to the law in the Italian 2024 Budget Law that now requires platforms like Airbnb to collect and remit tourist taxes in Italy. For years Airbnb has worked in partnership with some of Italy’s largest cities to collect and remit tourist taxes through voluntary agreements. Airbnb will now collect and remit tourist tax across Italy, starting with over 1,200 towns and cities, on February 15 with the rest to follow.”