South New Castle News

Doug Rainey, the COO of Delaware Business Now, wrote a piece describing an Air BnB tax mystery.

In the piece, Rainey discussed the short-term rental industry and described Air BnB as a mom-and-pop operator. He also said these short-term rental establishments operate as unregulated hotels.

"The short-term rental industry has long portrayed itself as being comprised of mom-and-pop operators who rent out a spare room or mother-in-law suite," Rainey said. "The reality is that some operators have assembled a variety of dwelling spaces and essentially operate as unregulated hotels."

Rainey reported that Delaware Air BnB hosts made more than $14 million in revenue last summer. 

"Airbnb has not been shy about touting its economic impact and noted that Delaware hosts collected more than $14 million in revenue over the summer," he said. "Using the current stateroom tax rate, Airbnb tax collections would have totaled $1.1 million during the three months."

He said the tourists mecca of Arizona were not shy about tapping into short-term rental revenue. Legislation passed in 2017 that netted $53 million in taxes that are distributed to local units of government.