Through county sales tax alone, though, this agreement could prove to be a boon for tax-collecting entities in the Lake of the Ozarks region, and more specifically Camden County, which as a popular travel destination has many Airbnb hosts. Five cities or zip codes in the area, mainly in Camden County, fall within Airbnb's top 30 home-sharing markets in Missouri.
Airbnb has announced an historic tax agreement with the Missouri Department of Revenue that will allow the company to collect and remit state taxes on behalf of its 6,300 Missouri hosts.
With the tax agreement in place, the state will be able to fully capitalize on more people visiting Missouri and staying longer through home sharing. Effective February 1, Airbnb will automatically collect and remit the state sales tax (about 4.2%) as well as a variety of local taxes on all Airbnb bookings in Missouri.
Airbnb is a home sharing online platform with short term rentals. It bills itself as “the world’s leading community driven hospitality company.”
The tax agreement accounts for a broad array of taxes assessed by the State Department of Revenue, including state and many county and municipal taxes:Missouri State Sales Tax: 4.225% City Sales Tax: 0.25 - 1.375% County Sales Tax: 0.25 - 0.5% Additional County Sales Tax: 0.125% - 0.5% Tourism Tax to Maintain Quality of Water: 0.25% Promotional Tourism Tax: 0.5 - 5% Local Sales Tax: 1%
Based on the state sales tax alone, if Airbnb bookings to Missouri were to replicate that of the last 12 months, it would mean $1.1 million in revenue to the state.
According to Jim Divincen with the Tri-County Lodging Association, the officials of this Lake area entity have just heard about the agreement and have asked their attorney to contact Airbnb in an effort to have the three Lake of the Ozarks Area Business Districts of Camden, Miller and Morgan counties included in the collection of required lodging taxes for the Lake of the Ozarks.
Through county sales tax alone, though, this agreement could prove to be a boon for tax-collecting entities in the Lake of the Ozarks region, and more specifically Camden County, which as a popular travel destination has many Airbnb hosts. Five cities or zip codes in the area, mainly in Camden County, fall within Airbnb’s top 30 home-sharing markets in Missouri.
According to statistics provided by Airbnb, the Osage Beach area was sixth in its list of Missouri markets in 2017, seeing 5,580 total guest arrivals last year for a total host income of $594,000.
The top five in order were St. Louis, Kansas City, Branson, Columbia and Springfield.
University City was in seventh place, but Lake Ozark came in at eighth. The Lake Ozark area saw 4,450 guest arrivals in 2017 for $565,000 in host income. Four Seasons was 15th, and Sunrise Beach in the 22nd slot and Camdenton 25th.
The complete list of rankings with total guest arrivals and host income are pictured with this article.
“Home sharing is introducing a whole new world of travelers to the authenticity of Missouri while offering new economic opportunities for thousands of middle class Missourians,” said Laura Spanjian, Midwest policy director for Airbnb. “We are so proud to have collaborated on this agreement, and we believe this can serve as a model for other states. We are dedicated to finalizing additional agreements to collect and remit taxes with Missouri municipalities.”
While Airbnb has partnered with about 350 of local governments throughout the U.S. to collect and remit taxes — including neighboring states like Iowa, Kansas, Illinois, Kentucky and Arkansas — this marks the company’s first tax agreement within Missouri. This agreement with Missouri DOR covers taxes assessed by the state, meaning any cities or counties with their own separately assessed taxes will require their own agreements with Airbnb. Columbia — with the support of Airbnb — is currently moving towards amending its law to allow short-term rentals to be taxed. Additionally, Airbnb has also encouraged Kansas City to consider updating its law so as to allow for the taxation of short-term rentals.
The agreement comes at a time of dynamic home sharing growth within Missouri. Airbnb recently announced that its Missouri host community earned $28.9 million in supplemental income in 2017 while welcoming 289,000 guest arrivals to the state.
Home sharing has impacted a wide spectrum of Missouri’s communities. Airbnb hosts significantly expanded lodging capacity during the eclipse as hotels in cities like St. Louis along the path of totality completely sold out. Airbnb provided additional, affordable lodging options for college parents during university commencement weekends in cities like Columbia and Kansas City. However, home sharing growth has also helped open up Missouri’s less traditionally touristy communities to the economic benefits of travel — rural areas of Missouri saw some of the fastest Airbnb guest growth of any state in the nation.
And Missouri hotel revenue and prices continue to grow — in parallel to Airbnb’s growth. This suggests that Airbnb is opening up the state to a new slice of prospective tourists by catering to travelers less able to afford hotels, those who desire to stay in neighborhoods or cities that lack hotels, and families who prefer to be together under one roof.
Airbnb welcomes the opportunity to secure tax agreements with any additional Missouri municipalities who assess their taxes independently. Local governments should contact the company at email@example.com to discuss further.