Should short term renters face hotel taxes? The governor thinks so

Governor looking at taxes on short-term rentals

NEW ORLEANS, LA (WVUE) - Gov. John Bel Edwards thinks short-term rental customers should pay taxes on their lodging just like hotel and motel customers.

Locally, there has been a lot of talk about such rentals, even before the governor's recent tax proposal.

"It's a hot issue," said Councilwoman Nadine Ramsey, who represents the French Quarter.

"It's about creating a level playing field," said Edwards.

With a click of a mouse, the website Airbnb gives property owners quick information on what they might earn by renting out their homes - or even just a room - to travelers.

Currently, in the city of New Orleans, the hotel-motel tax is 13 percent.

"It's also about the revenue, but it is about fairness because those taxes are being collected and remitted by people who are in the traditional lodging, and they're in competition against these other folks who are renting out their homes and other places, but not collecting and remitting the tax," Edwards said.

Current city law bans people from renting out their homes for less than a month in most neighborhoods. Still, the practice continues.

"I am pragmatic, and I'm a realist. I do not believe that with the access to the internet by virtually just everyone that you can eradicate short-term rentals entirely. I also think there is a place for short-term rentals in a city like New Orleans," said Councilwoman-at-large Stacy Head.

Eventually the council will decide whether to legalize such rentals and how to regulate them.

"…That we don't unfairly burden our hotels, and our inns and our bed and breakfasts," said Head.

Ramsay said there needs to be clear distinction between property owners who might engage in short-term rentals.

"Purchasers buying blocks of property renting that out, the neighbors across the street don't know who's coming in every weekend at their homes, but then on the other hand you have people who are saying, this is how I pay my bills," she said.

When it comes to the tax people staying in hotels and motels pay, Head does not believe that the city is getting its fair share of the revenue.

"We get a tiny, tiny percentage of sales tax, and at the end of the day, hotel-motel taxes. We are the inn keepers, and so we should get the first dollars that come."

Head said if the tax the governor proposes for online travel companies and sites like Airbnb is shared with the city the same way the existing hotel tax is, then she has serious issues with the idea.

"No, I'm not for it but if we can do something that's more equitable, particularly to make sure that neighborhoods in the city of New Orleans get their infrastructure improved, get their street lights taken care of, get their safety taken care of, then I'm absolutely for an equitable taxation scheme," she said.

We contacted Airbnb for comment. The company referred us to a report that says it has worked with cities around the world to establish programs to collect and remit taxes on behalf of hosts and their paying guests.

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