Hawaii tax authorities should expect close to $15 million annually from property owners who host Airbnb customers, according to a new report that quantifies how big Airbnb’s business is in the state just as lawmakers consider passing a bill that would help regulate the industry here.
The report, released for publication today, said that transient accommodation taxes and general excise taxes generated from lodging through Airbnb last year were about $12.2 million and that the figure is estimated to be about $15 million this year.
Local hotel industry consulting firm Hospitality Advisors LLC produced the report for Airbnb based on Airbnb data and customer surveys.
The report gives lawmakers an idea what the state might receive from one major online travel lodging listing service, though the information is being published after public debate has wrapped up on a bill that would regulate this industry.
Key negotiators in the state House and Senate agreed to final language in House Bill 1850 on Friday. The bill would let the state Department of Taxation arrange for online travel companies such as Airbnb to act as tax collection agents for the state.
The bill, which received support from Airbnb, the Tax Department and some in the hotel industry but was opposed by residents who want to crack down on illegal vacation rentals, is still subject to votes in the full House and Senate as well as consideration by Gov. David Ige before it can become law.
Joseph Toy, principal of Hospitality Advisors, said Airbnb had 247,000 customers in Hawaii last year. The report said those customers spent $89.6 million on local lodging, or $336 per trip.
Broken down per person per day, Airbnb customers in Hawaii spent an average of $71 on lodging. That was less than the averages for travelers who stayed in hotels ($116), condominiums ($85) and vacation homes ($77) but was more than those who stayed in timeshares ($47), the report said.
For the property owners who rented space to visitors through Airbnb, the median annual earnings from a single property ranged from $4,300 on Hawaii island to $7,700 on Oahu. On Maui the figure was $5,600, and on Kauai it was $5,100, the report said.
HB 1850 would allow a “transient accommodation broker” to collect vacation rental property taxes and general excise taxes on behalf of the state from vacation rental operators who book through such companies.
Besides Airbnb, other such companies include VRBO, HomeAway and Flipkey.
The report said VRBO, which stands for Vacation Rentals by Owner, has the most units listed in Hawaii at about 18,000. HomeAway, which owns VRBO, has about 17,000 local listings separate from VRBO. Airbnb has about 10,000 listings. Flipkey has about 8,000 listings to round out the four biggest industry players in the state.
Toy, however, noted that some owners list their property on multiple services, which makes assessing the market share for different listing companies hard to determine.
“The same unit can appear on a dozen or half a dozen websites,” Toy said.
The provisions in the bill, if they become law, would expire in five years unless renewed by the Legislature.