Airbnb to pay €576-million settlement in Italian tax evasion dispute
Short-term rental platform Airbnb said on Wednesday it has agreed to pay Italy's tax agency 576 million euros following tax evasion allegations.
Italy's financial police seized over 779 million euros from the online accommodation service last month on the order of Milan prosecutors, who accused the site of having failed to collect a rental income tax from landlords in the period from 2017 to 2021.
"Airbnb Ireland has finalised a settlement" which "covers host withholdings during the 2017 to 2021 period, for an aggregate payment of 576 million euros ($621 million). We are not seeking to recover any of this sum from our hosts," the company said.
READ ALSO: Italian police seize almost €800 million in unpaid tax from Airbnb
"We are continuing our constructive engagement with the Italian authorities for 2022 and 2023," it added.
Airbnb use has grown dramatically in recent years across the world, with the US-based platform allowing users to find accommodation in a private home rather than a hotel.
The company said in November that it has challenged a 2017 Italian law which requires short-term rental platforms which process payments to withhold host income tax.
In Wednesday's statement, Airbnb said the Italian government's recent budget plans clarify how this process should work.
"We welcome the clarity offered by this planned update to Italian law and are preparing to comply by introducing new tools for applicable hosts to have their taxes withheld automatically by Airbnb, and paid to the Italian Revenue Agency on their behalf directly," it said.
Italy's draft 2024 budget law, published in October, says all tourist lettings will be given a "national identification code".
The move would oblige renters to register and provide much-needed "transparency", according to Deputy Prime Minister Antonio Tajani.
It would also bring money into the state coffers and "reduce the tax burden" on families, he said at the end of October.
Owners of short-term rental apartments currently pay a 21-percent rental income tax.
That rate will stay for the first apartment rented out by a host. But the government plans to raise the tax to 26 percent for all further apartments rented out for a period of fewer than 30 days.
The introduction of a "national identification code" was welcomed by hotels owners, who have long complained of "unfair competition" from short-term tourist rentals, which are also accused of driving up rents and aggravating a shortage of affordable housing.
Comments
See Also
Italy's financial police seized over 779 million euros from the online accommodation service last month on the order of Milan prosecutors, who accused the site of having failed to collect a rental income tax from landlords in the period from 2017 to 2021.
"Airbnb Ireland has finalised a settlement" which "covers host withholdings during the 2017 to 2021 period, for an aggregate payment of 576 million euros ($621 million). We are not seeking to recover any of this sum from our hosts," the company said.
READ ALSO: Italian police seize almost €800 million in unpaid tax from Airbnb
"We are continuing our constructive engagement with the Italian authorities for 2022 and 2023," it added.
Airbnb use has grown dramatically in recent years across the world, with the US-based platform allowing users to find accommodation in a private home rather than a hotel.
The company said in November that it has challenged a 2017 Italian law which requires short-term rental platforms which process payments to withhold host income tax.
In Wednesday's statement, Airbnb said the Italian government's recent budget plans clarify how this process should work.
"We welcome the clarity offered by this planned update to Italian law and are preparing to comply by introducing new tools for applicable hosts to have their taxes withheld automatically by Airbnb, and paid to the Italian Revenue Agency on their behalf directly," it said.
Italy's draft 2024 budget law, published in October, says all tourist lettings will be given a "national identification code".
The move would oblige renters to register and provide much-needed "transparency", according to Deputy Prime Minister Antonio Tajani.
It would also bring money into the state coffers and "reduce the tax burden" on families, he said at the end of October.
Owners of short-term rental apartments currently pay a 21-percent rental income tax.
That rate will stay for the first apartment rented out by a host. But the government plans to raise the tax to 26 percent for all further apartments rented out for a period of fewer than 30 days.
The introduction of a "national identification code" was welcomed by hotels owners, who have long complained of "unfair competition" from short-term tourist rentals, which are also accused of driving up rents and aggravating a shortage of affordable housing.
Join the conversation in our comments section below. Share your own views and experience and if you have a question or suggestion for our journalists then email us at [email protected].
Please keep comments civil, constructive and on topic – and make sure to read our terms of use before getting involved.
Please log in here to leave a comment.