Airbnb hosts angered by Auckland Council's bed tax

by Matthew Theunissen / 01 August, 2018

Airbnb hosts in Auckland will have to pay backdated bed taxes to Auckland Council - in some cases in the thousands of dollars. Photo / screenshot

Some Airbnb hosts say they are going to leave the online accommodation service as a result of a new Auckland Council tax.

The council has introduced a new targeted rate for online accommodation providers to bring them in line with hotels and motels.

Some say the new costs could spell the end of Auckland's Airbnb boom, with most of the providers at a heated meeting last night saying they would rather close down than meet the new costs.

Ray Pitch, who runs a small online accommodation business out of his Pakuranga home, said he was hit with an $11,000 rates bill this year.

He accepted that hosts should be taxed for their earnings but was angry at the lack of transparency in the council's approach.

He said it came as a shock when he found out he would need to pay for all his bookings since July 2017.

"People are now being put in a position where they cannot afford to carry on and they can't afford to stop, because if you stop you're still going to be charged on the basis of what you did last year," Mr Pitch said.

Airbnb is not able to provide the council with the details of its hosts.

'This is a new process'

Auckland Council policy advisor Aaron Matich said it was relying on people coming to them to let them know if they were running a business out of their homes.

Council officers were also able to identify some properties by going through the online accommodation websites, he said.

"This is a new process and we are relying on a lot of information coming from the providers and we would hope that people are going to be honest with us and provide us with the information that we need to be able to do this."

However, Mr Pitch said it was unfair that he should have to pay while others did not.

"The people that the council is aware of are the honest people who have made a declaration."

Mr Pitch has made a complaint to the Ombudsman over the way the council has handled the new tax.

'Not retrospective'

However, the council said it should be no surprise that the new tax - the Accommodation Provider Targeted Rate (APTR) - was being applied from July 2018, because all rates were set on the basis of what happens the previous year.

In a statement, the council said it was not a "retrospective" tax.

"If property owners can provide evidence that their property was not being advertised on online accommodation provider websites this financial year, they will not be charged the APTR for this financial year, or the previous financial year."

According to another Airbnb host, who wished to only use her first name Cat, the council was not taking into account the wider tourism implications of the rates, given how many people she believed would now sign off from Airbnb.

"For me, the amount of effort involved, no. I think I will pull," she said.

"A number of people I spoke to at the meeting last night said that they've got bookings right through to February, March next year and they said they were also intending to pull."

*Editor's note: This is a new version of an earlier story, which provides clarification.

This article was originally published by RNZ.

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