Vancouver councillor to ask the province to begin collecting taxes on Airbnb rentals

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      Airbnb has become a thorn in the side of Vancouver policymakers.

      There are more than 4,700 Airbnb listings for Vancouver. Of those, 3,179 are for entire residences, according to the data-analysis website InsideAirbnb. And with the vacancy rate for rentals in Vancouver at less than one percent, there’s legitimate concern that at least some of those listings are subtracting units from the city’s rental stock.

      City staff are studying how a local government can best control short-term rentals like those organized on Airbnb. But their report is not expected until the fall.

      In the meantime, Vision Vancouver councillor Geoff Meggs is proposing that the provincial government do more to ensure citizens get their fair share of Airbnb profits via the collection of all applicable taxes, which Meggs told the Straight is not happening today.

       “It’s time for the province to enforce its rules, which are already in place, for people who are offering rentals, whether online or otherwise, to collect provincial sales tax and hotel tax,” he said in a telephone interview.

      “Expedia has always been told it should collect it and it does,” Meggs continued. “So this is a simple way to just level the playing.”

      He explained that the impact on users would be minimal, with the collection of taxes occurring digitally via Airbnb.

      Meggs has drafted a motion that will go before council on June 28. It asks the province to take measures to ensure that Airbnb collects both a provincial sales tax and a hotel tax on transactions that occur via its service.

      A draft copy of that motion states that, in accordance with existing provincial legislation, the taxes in question should be applied to any Airbnb host that offers four or more listings under one name.

      According to InsideAirbnb, that would affect 416 Airbnb listings for Vancouver, or roughly nine percent of all listings as of April 2016.

      That might not sound like much, but the taxes the province could collect from those units might be significant. One analysis of Airbnb data  the Straight reported on earlier this month revealed the service's top 10 Vancouver hosts together earn $3.2 million in annual revenue.

      The B.C. Chamber of Commerce voted to support similar recommendations at its last annual general meeting that was held on May 29.

      “It’s important that sharing economy operators such as Airbnb pay appropriate taxes, to ensure we’re keeping things fair for our existing hotels and other tourism businesses as they try to compete with newcomers who, for now, aren’t paying tax,” said interim CEO Maureen Kirkbride in a media release.

      Meggs emphasized that there are other measures both the city and province should consider taking to minimize the impacts that Airbnb and similar services have on rental stock.

      “I think commercial users have to be tracked down,” he explained. “I would, personally, like to see it eliminated to the largest degree possible in long-term rental buildings unless there is some agreement with the landlord or something of that sort.”

      How exactly one defines commercial use of Airbnb is a matter of debate. But, as previously reported by the Straight, it is relatively easy for Airbnb to apply different filters against its hosts to eliminate listings that a local government might find problematic.

      Applying filters to data presented by the Inside Airbnb website shows a large number of Vancouver listings are for an entire place that is also available for more than 90 days of the year. That suggests some of these 2,408 units may not have full-time residents and are essentially operating as hotels.
      INSIDE AIRBNB

      For example, on June 7, the Straight reported that an undergraduate student at UBC named Iain Marjoribanks analyzed Airbnb data for Vancouver to determine that 53 percent of hosts were renting units on a commercial basis and, of those, 27 percent were large commercial operators listing three or more units.

      Within those classifications, Marjoribanks defined an "extensive commercial" listing as a unit rented out more than 88 days of the year and found that there were 161 of those listings in Vancouver. He defined an "intensive commercial" listing as renting a unit between 58 and 88 days of the year and found there were 182 of those.

      Alternatively, in December 2015, the Straight reported on an analysis by Karen Sawatzky, an SFU master’s student, who found that there are 1,248 Airbnb listings in Vancouver that could be considered problematic. She made that judgement by using InsideAirbnb to filter results to only show listings where an entire house or apartment was rented out on a recent and frequent basis.

      Regardless of the measure, Meggs, Sawatzy, and Marjoribanks all agreed in separate interviews that, from a technological standpoint, it is easy for Airbnb to remove unwanted listings.

      Sawatzky has repeatedly noted that the company has already done so for New York, San Francisco, and other markets.

      “It’s just a matter of which filter you pick and click on,” Sawatzky told the Straight last April. “Of course they can do this.”

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