Huntsville not pursuing tax agreement with Airbnb

If a city has an agreement, Airbnb will take the taxes out and give the money directly to the city.

Posted: Oct 2, 2018 5:46 PM
Updated: Oct 2, 2018 5:51 PM

Huntsville is home to one of the largest Airbnb markets in Alabama without a tax agreement. This means the city is not directly collecting taxes from reservations made through the app.

WAAY 31 talked to city officials to see if a tax agreement is in the works for the city.

As Huntsville continues to grow, more tourists are expected to visit and with increased tourism and the higher demand for lodging, that's where businesses like Airbnb come in handy, not only for tourists but for cities too.

The difference between a city having a tax agreement or not comes down to whether or not hosts are responsible for taking taxes out of reservations.

If a city has an agreement, Airbnb will take the taxes out and give the money directly to the city. The lodging tax is then used by cities for different things in their community.

I reached out to the City of Huntsville to see if a tax agreement is something the city would adopt. I learned the city is not currently seeking a tax agreement. The city administrator told me even without a tax agreement, they're able to collect a lodging tax that goes to the local government entities.

"Primarily to help fund agencies that are in the tourism business. And the city lodging tax is also used very similar to that, so it helps support the Von Bruan Center, the convention of visitors bureau, the sports commission," said John Hamilton, the City of Huntsville Administrator. 

Right now each Airbnb host is required to take the lodging tax out and file it on their own. The city admin told me the focus right now is on ensuring each Airbnb host is operating under a business license.

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