Greece to tax Airbnb rentals

Santorini, Greece
Santorini, Greece

Greece is planning to tax all Airbnb rentals in the country.

The government has announced plans to introduce a charge for homeowners who rent out their homes on short-term rental websites, such as Airbnb. The levy, which could be between 3 per cent and 5 per cent on each booking, will be put to the vote next month, with owners having to register properties with the government in order to advertise them for rent.

“We will ensure that properties are registered. Anyone posting on internet sites that they have property for rent will have to have registered it first. This is just part of the government action we’re taking to fight tax evasion, illegal trading and corruption,” Deputy Finance Minister Trifon Alexiadis told Euronews, which notes that there are 50,000 short-term rental listings on Airbnb in Greece, and 8,000 in Athens alone.

The surprising move makes the country the first to charge a tax on short-term rentals. It is, however, the latest in a long line of moves against the burgeoning online industry, which has already prompted crackdowns in everywhere from Barcelona to Berlin.

Indeed, the concern is partly that the unregulated sector is causing the traditional holiday accommodation industry to suffer, with hotels in Greece reporting low vacancy rates. In italy, the industry is also calling for Airbnb taxes to be introduced.

George Tsakiris, President of the Hellenic Chamber of Hoteliers, says: “This is hurting the state, it hurts public revenue, it hurts jobs, it hurts competition, it creates an unfair business environment, it threatens the viability of Greek tourism businesses.”

At the same time, cities such as Berlin are concerned that Airbnb and similar websites are contributing to a shortage of housing, as investors buy up homes and rent them out. In Barcelona, locals are now encouraged to report their neighbours if they are renting out a home on a short-term basis withou having registered for a licence.

Barcelona’s new mayor, Ada Colau, is now threatening to fine firms such as Airbnb, if they advertise homes without a number proving they are on the Catalan register for tourist accommodation. Colau, who was elected in May 2016, has also said that rental websites should give the government information on property owners, to compare with their own register.

“Everybody must comply with the same game rules,” Colau told Reuters. “An internet platform cannot become a means to thwart the regulations and to shelter illegal tourist apartments.”

Israel is also looking to crackdown on people renting out properties to tourists, with the country’s tax authority finding that more than 30 per cent of them have not declared their income from the short-term leases.

Audits are being conducted in Tel Aviv, Jerusalem and other cities, reports Haaretz, with the Tourism Ministry now debating following in Greece’s footsteps to introduce a tax of 35 per cent on short-term leasors, which would be collected via the rental companies.