Ben Breit, Airbnb Midwest
MADISON – Airbnb, the Midwest’s leading community driven hospitality company, announced today the finalization of a historic tax agreement with the State of Wisconsin that will allow the company to collect and remit occupancy taxes on behalf of its Wisconsin hosts.
With the tax agreement in place, the State will be able to fully capitalize on more people visiting Wisconsin and staying longer through home sharing. Effective July 1, Airbnb will automatically collect and remit taxes to the Wisconsin Department of Revenue on all Airbnb bookings, making the process seamless and easy for both hosts and the State.
“Home sharing is introducing a whole new world of travelers to the authenticity of Wisconsin while offering new economic opportunities for thousands of Wisconsin residents,” said Laura Spanjian, policy director for Airbnb Midwest. “We are so proud to have collaborated on this deal which will unlock a brand new tax revenue stream for the State of Wisconsin. This is a model we hope to replicate throughout the Midwest.”
The agreement pertains to the following taxes:
-State sales tax
-County sales and use tax
-Baseball Stadium District Tax (applies to following counties: Milwaukee, Ozaukee, Racine, Washington, Waukesha)
-Local exposition taxes (applies only to Milwaukee)
-Premier resort area taxes (applies only to Rhinelander, Stockholm, Eagle River, Bayfield, Wisconsin Dells and Lake Delton)
Airbnb has partnered with hundreds of governments throughout the world to collect and remit taxes. This agreement comes on the heels of a tax deal with the City of Madison allowing Airbnb to collect and remit the Madison transient occupancy tax, which took effect May 1. Wisconsin municipalities administer their own local occupancy taxes, while the State (and therefore this most recent tax deal) covers all other taxes associated with short-term rentals. Airbnb conservatively projects to remit hundreds of thousands of dollars annually to the State moving forward as a result of this agreement.
Airbnb also announced a similar home sharing tax agreement today with the State of Michigan. Within the Midwest, the company also has tax agreements in place with the City of Chicago, City of Cleveland, State of Illinois, City of Madison (Wisconsin), and State of Kansas, among others.
The agreement comes at a time of dynamic home sharing growth within the Badger State. In 2016, Airbnb Wisconsin hosts earned $13 million in supplemental income while welcoming approximately 105,000 guests to the state. Home sharing has been particularly beneficial to Wisconsin by expanding lodging capacity for communities hosting large events that cause hotels to reach peak occupancy. Airbnb guest numbers routinely spike in Green Bay during Packer football games, in Milwaukee during Summerfest, and in Madison during events associated with the University of Wisconsin.
Airbnb in Wisconsin:
-3,300 active hosts
-105,000 guest arrivals to Wisconsin via Airbnb in 2016, representing 164% year-over-year growth
-Wisconsin hosts earned $13 million combined in supplemental income in 2016 through Airbnb
-Typical Wisconsin host earns $4,000 annually through Airbnb
-32% of Wisconsin Airbnb listings are simply extra, unused rooms in a host’s home (i.e. empty nester)
-Typical Wisconsin listing is rented out 2 days per month