Airbnb's Tax Deal With Kansas May Be Model for Midwest

by | January 17, 2017

By Diane Stafford

Airbnb has reached a tax agreement with the Kansas Department of Revenue to begin collecting taxes on its home-sharing bookings in the state.

The company will announce Monday that it will automatically collect and remit the taxes, putting Airbnb lodging on the same footing, taxwise, as hotels and other lodging establishments.

Airbnb hosts will not have to handle the process, and their fees to Airbnb will not increase, the company said.

With the agreement, effective Feb. 1, Kansas becomes the 15th state in which Airbnb has statewide tax deals that basically treat home-sharing bookings like hotels in terms of short-term occupancy taxes.

Laura Spanjian, policy director for Airbnb Midwest, said the company was "proud to have collaborated on this deal, which will unlock a brand new tax revenue stream" for Kansas. She said it was a model the company wants to expand throughout the Midwest.

According to Airbnb, the rates and amounts collected in the state will vary depending on the location of the hosts. In addition to the state retail sales tax of 6.5 percent, the collections will include local sales taxes ranging between 1 percent and 7 percent and "local transient guest taxes" ranging from 2 percent to 9 percent.

Jeannine Koranda, a spokeswoman for the revenue department, said the agreement "puts Airbnb on a level playing field with other Kansas guest accommodations such as hotels, motels, guest houses and bed and breakfasts."

Koranda said there was no estimate for the revenue that will accrue to the state from the tax deal. Because of the different locations of hosts' homes, the company said it couldn't estimate an exact revenue, either.

According to Airbnb, its approximately 600 hosts in Kansas earned $2.1 million in income from about 20,000 guest arrivals in 2016. About half of the Kansas Airbnb rentals are for a single room in hosts' houses or apartments.

Airbnb currently has statewide tax agreements with Alabama, Arizona, Connecticut, Florida, Illinois, Louisiana, North Carolina, Oregon, Pennsylvania, Rhode Island, South Carolina, Utah, Vermont and Washington. It also has tax deals with some large cities, such as San Francisco; Portland, Ore.; Philadelphia; Phoenix; San Diego; San Jose, Calif.; and Washington, D.C.

(c)2017 The Kansas City Star (Kansas City, Mo.)