Taxing of vacation rentals could become law

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Vacation rentals are a hot and controversial topic — and they can cause divisions in Hawaii neighborhoods as well as in the visitor industry.

The online companies that promote vacation rentals around the islands could soon be required to collect taxes on those short-term vacations.

The bill, that would add taxes to visitors’ vacation rental bills — is heading to Governor David Ige’s desk for consideration.

Companies like Airbnb and Expedia would be required to collect — and pay — taxes — on behalf of homeowners who run short-term rentals.

In a statement an Expedia Policy Communications executive Philip Minardi says:

“Expedia group has been steadfast in its commitment to a holistic policy that works for local communities and for Hawaii’s travel and tourism economy. However, the company remains deeply concerned with the requirement to submit the confidential information of its customers to the state.”

Counties would use the information to collect property taxes, while the state would use it to collect general excise and transient accommodations taxes. 

Mufi Hannemann, president and CEO of the Hawai’i Lodging & Tourism Association, says the argument has been successfully challenged in other places.

“I think today, was a very close vote and it’s an indication of how the state continues to grapple with getting major consensus on something that is long overdue.”

Hanneman, Expedia and other interested parties are actively following a City Council bill that takes a different approach to vacation rental requirements. It will be heard next week.

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