Committee advances vacation rental tax measure

A version of a bill supported by Airbnb that would allow the online vacation rental giant and similar companies to collect and remit taxes on behalf of hosts has passed out of the Senate Committee on Tourism and International Affairs.

SB 2693, introduced by Sen. Rosalyn Baker, will have to get similar approval from the Senate Committee on Commerce, Consumer Protection and Health to continue to the Senate Ways and Means committee. The commerce committee did not have a quorum Wednesday so it deferred its vote until this morning.

Airbnb said the bill is part of a global push to ensure hosts pay their taxes. The bill would allow Airbnb and similar entities to register as tax collection agents, enabling them to collect general excise and transient accommodations taxes for hosts. Agents would remit taxes to the state, but would not be required to disclose host names and addresses.

While most audience members were in favor of the bill, Larry Bartley, executive director of Save Oahu’s Neighborhoods, testified in opposition. Bartley said the nondisclosure portion of the bill would undermine county enforcement against illegal vacation rental operators.

“If you think this is about Airbnb being a good guy and wanting to collect for the state, you are wrong,” Bartley said. “It’s designed to hide who is conducting illegal operations.”

Sen. Kalani English, chairman of the tourism committee, said that point is moot since the state cannot legally share tax information with the county. English said the measure benefits tourism by making it easier for hosts to comply with tax requirements, thus leveling the playing field between transient accommodations and hotel operators.

“If Airbnb registers as a tax collection agent, it almost forces other sites like VRBO and Homeaway to do the same,” English said. “It will lead to greater compliancy down the line.”

Cynthia Wang, Airbnb public policy manger for the Northwest and Hawaii, said Hawaii’s Airbnb community wants to pay required taxes.

“We’ve worked with them and the government to make that happen,” said Wang, who estimates that Airbnb’s Hawaii market has between 9,000 and 10,000 listings, which may or may not be available on any given day.

Airbnb’s global tax director, Beth Adair, said Airbnb currently makes Hawaii hosts aware of taxation requirements, but currently cannot track the percentage that do pay.

“In places where we do it, we know that percentage is 100 percent,” Adair said.

If the measure passes, Adair said Hawaii would join states like Florida, Oregon, North Carolina, Washington and Rhode Island where Airbnb has similar initiatives.