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A revenue source worth exploring

October 17, 2019 05:20 pm

Budget season is the season for talking about revenue, particularly sales tax revenue. We know that tourism is boosting sales tax revenue in Greene and Columbia counties. Visitors to our area, quite naturally, spend money on all sorts of things in all kinds of supermarkets, shops and convenience stores.

Short-term rentals have been generating sales tax revenue that Twin County communities would dearly love to get their hands on. Millions of dollars in revenue are going uncollected, according to studies. And Columbia and Greene lawmakers are open to ways of collecting some of this money.

A state bill would make the business of Airbnb more akin to other forms of lodging. The bill, introduced in the state Assembly by Assemblywoman Patricia Fahy, D-109, would require short-term rental apps such as Airbnb to collect sales tax and the hosts to register their rentals with the state Department of State.

Because there is no sales tax collection mechanism in place for short-term rentals, $112.7 million in taxes goes uncollected annually for Airbnb rooms, according to the state Hospitality & Tourism Association. Another reason for taking this bill seriously is the rise of short-term rentals in the area. It is having an impact on local resorts, as well as the county’s revenue from tourism-related sales tax.

In Greene County there were 45,300 guest arrivals [through Airbnb] in summer 2019. Greene County ranked third largest for guest arrivals in the Capital Region. Greene County and Columbia County have more than 1,000 Airbnb units each, according to the state Hospitality & Tourism Association. Those overnight stays generated $7.6 million to the hosts.

The state Hospitality & Tourism Association estimates that Airbnb hosts in Greene County make $25 million annually, yet this represents a loss of $1 million in sales tax. Judging from the interest Fahy’s proposed legislation is getting, it seems worth exploring further.