Gov. David Ige today put a controversial vacation rental tax collection bill on his “intent to veto” list.
Senate Bill 1292 requires vacation rental platforms such as Airbnb and Expedia to collect taxes from transient rental operators on behalf of the state.
Placing the bill on the list does not ensure he will veto, but when asked of any bills he was certain to reject, Ige immediately said he was inclined to take the action against the vacation rental bill.
Ige, at a press conference, noted that Honolulu Mayor Kirk Caldwell has indicated he will sign City Council Bill 89 (2018), imposing stronger fines and tougher enforcement tools against vacation rental operators.
“The state’s taxation of transient accommodations through the hosting platforms should complement the counties’regulations of transient accommodations,” Ige said.
The Senate bill did not specifically call for the state to hand over to the counties any of the information it receives from the hosting platforms and he thinks a stronger bill could be crafted that works in unison with the city legislation.
“I think knowing that the City Council is going to create a registration process for the (transient vacation units) … allows us to craft a proposal that specifically acknowledges that, and allows us to incorporate that into our tax collection efforts,” Ige said.
While the Senate bill may make tax collection more efficient, “we want to make sure there are no adverse unintended consequences,” he said.
In the Legislature, all but one House member supported the bill while the Senate vote was a narrow 13-12 in favor.
City officials say that having the hosting platforms collect the taxes provides a shield that would make it more difficult for the city to collect information about the vacation rental operators it wants to regulate.
Two bills approved last week by the City Council and now on Caldwell’s desk would impose tighter rules on the hosting platforms and operators. Caldwell has indicated that he will sign Bill 89, one of the two bills, Tuesday.
Ige put 19 other bills on the “intent to veto” list.
Any measure the governor has not taken action on by July 9 becomes law without his signature.