Tuesday , September 25 2018

Auckland tax branded a failure as city struggles to find its target

Auckland’s new Airbnb tax “falls dismally short of the mark” according to a leading industry body.

Tourism Industry Aotearoa has criticised Auckland City Council’s inability to enforce its new rating policy, which is designed to regulate the capital’s short-lease accommodation sector.

The policy extends a tourism levy, introduced last year for hotels and motels, to cover to short-let properties rented out through sites such as Airbnb for more than 28 nights a year.

TIA chief executive Chris Roberts said: “Only 1100 properties are to pay the new rate.

“But according to Auckland Council’s report Airbnb & Housing in Auckland, there are 12,357 properties available on Airbnb in the city – and that number is growing all the time.

“The council is expecting payment from just 9 percent of Auckland’s Airbnb providers.”

TIA is questioning the rationale behind the council’s decision to exclude room-only bookings from the bed tax.

The Airbnb and Housing in Auckland report notes that, of the 12,357 properties available on Airbnb, there is an even split between entire place (49 percent ) and private rooms (49 percent), with the remaining two percent comprising shared rooms.

“Exempting the room-only providers excludes a significant proportion of the market, as it can be reasonably assumed that some of these room-only providers are generating significant annual income,” said Mr Roberts.

“Our view is that to achieve fairness and spread the rate burden, room-only providers should also be included.”

TIA agrees that operators providing more than 135 nights of accommodation per year should pay business rates and the bed tax. For those providing between 29 and 135 accommodation nights a year, the organisation backs a 35 percent business rate over the Council’s agreed rate of 25 percent.

Mr Roberts says his organisation recognises that Airbnb-style short lets offers choice to consumers and meet an “important need”, especially over peak periods.

But he says the sector needs regulation which is fair to all providers, allows for quality control and ensures guest  safety.

About Kate Jackson

Kate Jackson
Kate Jackson is the editor of Accomnews and Accom Management Guide. You can reach her at any time with questions or submissions: editorial@accomnews.co.nz

2 comments

  1. Auckland’s new Airbnb tax “falls dismally short of the mark” according to a leading industry body.

    If all AirBnb’s were charged the same as other accommodation providers for rates including this ridiculous bed tax – I feel sure that the housing problem in Auckland could be slightly alleviated – Kill two birds with one stone.

  2. The councils need to be smarter and rather than chasing them around at great cost to the ratepayers just make it a requirement under their district plan that all accommodation providers that meet the litmus test they put in place must be registered with the council. Any that dont face a $10,000 fine. Give them a two month grace period then implement the fines.
    Just crazy that they think running after them is the way to do it and just wrong that many think avoidance of a common tax is acceptable. But most wont be paying tax so no surprises there I suppose.

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