Dear WH&LA Lodging Member:
Today Airbnb announced that they had finalized an agreement with the State of Wisconsin to collect and remit taxes to the state Department of Revenue on all Airbnb bookings at Wisconsin properties of all types starting July 1 of this year.
More specifically, even though it is stated as collecting "occupancy taxes", Airbnb will collect and remit the following:
- Wisconsin state sales tax
- County sales tax (in counties charging such)
- Baseball Stadium District Tax ( for Milwaukee, Ozaukee, Racine, Washington, and Waukesha counties only)
- Local Exposition taxes (Milwaukee only)
- Premier Resort Area Taxes authorized by the state in 6 municipalities currently
Noticeably absent is the collection and remittance of Local Room Tax in the over 320 municipalities with a Room Tax. The exception is the City of Madison, which negotiated this collection independently starting May 1.
Airbnb is claiming they currently have 3,300 active hosts in Wisconsin generating $13 million in revenue to their hosts.
While this is an important
first step in leveling the playing field with licensed tax-paying lodging properties, it cannot be viewed as the only step needed. As WH&LA has shared with various reporters today and numerous legislators, it is critical that, as the platform that collects payment from travelers for their stays, they also collect and remit the currently missing local Room Tax, which should help increase revenue around the state for local tourism promotion and tourism development.
Additional steps, such as ensuring licensure (basic safety compliance) and making sales information available to the state during audits (to ensure proper remittances of taxes) also remain as goals.
Airbnb's press release can be found below.
Best,
Trisha
Trisha A. Pugal, CEA | President, CEO | Wisconsin Hotel & Lodging Association
1025 South Moorland Road - Suite 200, Brookfield, WI 53005
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(Sent from Airbnb)
Ben Breit, Airbnb Midwest
Phone: (847) 274-5456
Airbnb Announces Historic Home Sharing Tax Agreement with State of Wisconsin
MADISON
- Airbnb, the Midwest's leading community driven hospitality company, announced today the finalization of a historic tax agreement with the State of Wisconsin that will allow the company to collect and remit occupancy taxes on behalf of its Wisconsin hosts.
With the tax agreement in place, the State will be able to fully capitalize on more people visiting Wisconsin and staying longer through home sharing. Effective July 1, Airbnb will automatically collect and remit taxes to the Wisconsin Department of Revenue on all Airbnb bookings, making the process seamless and easy for both hosts and the State.
"Home sharing is introducing a whole new world of travelers to the authenticity of Wisconsin while offering new economic opportunities for thousands of Wisconsin residents," said Laura Spanjian, policy director for Airbnb Midwest. "We are so proud to have collaborated on this deal which will unlock a brand new tax revenue stream for the State of Wisconsin. This is a model we hope to replicate throughout the Midwest."
The agreement pertains to the following taxes:
·
State sales tax
·
County sales and use tax
·
Baseball Stadium District Tax (applies to following counties: Milwaukee, Ozaukee, Racine, Washington, Waukesha)
·
Local exposition taxes (applies only to Milwaukee)
·
Premier resort area taxes (applies only to Rhinelander, Stockholm, Eagle River, Bayfield, Wisconsin Dells and Lake Delton)
Airbnb has partnered with hundreds of governments
throughout the world to collect and remit taxes. This agreement comes on the heels of a tax deal with the City of Madison allowing Airbnb to collect and remit the Madison transient occupancy tax, which took effect May 1. Wisconsin municipalities administer their own local occupancy taxes, while the State (and therefore this most recent tax deal) covers all other taxes associated with short-term rentals. Airbnb conservatively projects to remit hundreds of thousands of dollars annually to the State moving forward as a result of this agreement.
Airbnb also announced a similar home sharing tax agreement today with the State of Michigan. Within the Midwest, the company also has tax agreements in place with the City of Chicago, City of Cleveland, State of Illinois, City of Madison (Wisconsin), and State of Kansas, among others.
The agreement comes at a time of dynamic home sharing growth within the Badger State. In 2016, Airbnb Wisconsin hosts earned $13 million in supplemental income while welcoming approximately 105,000 guests to the state. Home sharing has been particularly beneficial to Wisconsin by expanding lodging capacity for communities hosting large events that cause hotels to reach peak occupancy. Airbnb guest numbers routinely spike in Green Bay during Packer football games, in Milwaukee during Summerfest, and in Madison during events associated with the University of Wisconsin.
Airbnb in Wisconsin:
·
3,300 active hosts
·
105,000 guest arrivals to Wisconsin via Airbnb in 2016, representing 164% year-over-year growth
·
Wisconsin hosts earned $13 million combined in supplemental income in 2016 through Airbnb
·
Typical Wisconsin host earns $4,000 annually through Airbnb
·
32% of Wisconsin Airbnb listings are simply extra, unused rooms in a host's home (i.e. empty nester)
·
Typical Wisconsin listing is rented out 2 days per month
Overview of 2016 guest arrivals and total host income, broken down by the top 20 home sharing cities in Wisconsin:
|
City
|
Total 2016 Guest Arrivals
|
Total 2016 Host Income
|
|
Milwaukee
Madison
Green Bay
Lake Geneva
Sturgeon Bay
Wisconsin Dells
Egg Harbor
Appleton
La Crosse
Hayward
Baraboo
Williams Bay
Elkhorn
Poynette
Oshkosh
Wauwatosa
Sheboygan
Shorewood
Fontana
Neenah
|
20,000
19,000
3.500
2,200
2,100
1,900
1,300
1,200
1,200
1,100
1,100
1,000
920
870
850
850
830
780
750
720
|
$2.1 Million
$2.5 Million
$603,000
$316,000
$365,000
$231,000
$186,000
$142,000
$99,000
$148,000
$113,000
$128,000
$206,000
$74,000
$232,000
$101,000
$130,000
$115,000
$102,000
$89,000
|
About Airbnb
Founded in 2008, Airbnb's mission is to create a world where people can belong when they travel by being connected to local cultures and having unique travel experiences. Its community marketplace provides access to millions of unique accommodations from apartments and villas to castles and treehouses in more than 50,000 cities and 191 countries.
