Airbnb pays back taxes to
San Francisco
Airbnb has paid back taxes that ran into the millions of dollars to the
city of San Francisco, the company says
Al Jazeera with The Associated Press
February 19, 2015
Airbnb has paid back taxes that ran into the millions of dollars to the
city of San Francisco, the company said Wednesday.
The San Francisco-based company said in a statement on Wednesday that
it has paid in full a back-tax bill. A spokesman wouldn't say how much
the company paid
San Francisco’s City Treasurer Jose Cisneros ruled in 2012 that Airbnb
owed back taxes. He has declined to reveal how much money he collected
so far from Airbnb, saying local law mandates confidentiality on all
tax matters.
Officials had estimated that Airbnb owed the city as much as $25
million, local media has reported since Cisneros' ruling.
Airbnb has become one of Silicon Valley's most successful start-ups,
valued it at $13 billion, according to the Wall Street Journal.
But the company has come under pressure from many cities it operates,
including New York City, and the San Francisco "settlement could set a
precedent for Airbnb, which is facing pressure from other cities to pay
their hotel taxes," the San Francisco Chronicle reported. "It’s been
estimated that the total the firm owes nationwide could amount to $200
million."
The back-tax issue had threatened to unravel legislation that the
supervisors passed last year legalizing short-term home rentals in the
city. The law mandated that Airbnb pay the city's hotel tax going
forward, but it didn't address issue of back taxes.
Senator Dianne Feinstein, a Democrat, had opposed the legislation,
saying “Simply put, this bill will further increase already sky-high
rental costs.” Critics said the short-term rental services like Airbnb
kept housing units off the rental market in a city with an affordable
housing shortage.
Regulating
short-term rentals
The law, which took effect Feb. 1, allows only permanent residents to
offer short-term rentals; it requires hosts register with the city and
get a business license and permit; and it mandates the collection of
hotel tax. It also limits entire-home rentals to 90 days per year,
requires each listing to carry $500,000 in liability insurance, and
establishes guidelines for enforcement by the Planning Department.
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