In a proposed class action lawsuit filed last week, several cities and counties throughout the state of Georgia accused Airbnb of failing to pay taxes owed to their municipalities. The plaintiffs, City of Rome, Hart County, City of Cartersville, and City of Tybee Island, Georgia, claim that the defendant Airbnb has not been collecting or remitting taxes since 2015.
Airbnb is comprised of a pool of “hosts,” who make their accommodations available to “members,” who are the consumers of the accommodation. In some instances, Airbnb collects taxes from both the host and the member. But according to their website, “[e]ven if Airbnb automatically collects and pays certain occupancy taxes on your behalf, you may still be required to manually collect other occupancy taxes. For example, Airbnb may collect regional taxes, but not local ones in some places. Also, Airbnb is not responsible for any tax collection errors due to typos.”
According to the plaintiffs, however, Airbnb was aware of Georgia’s laws and the need to remit their taxes. In a letter sent back in 2015, Airbnb was warned that they needed to be compliant with the state’s tax regulations and were asked to pay back taxes. Included with the letter was a list of Georgian municipalities and their current excise tax rates. Additionally, other follow-up letters were sent to Airbnb, but the company never responded to the demands.
Airbnb’s website has published content to help hosts better understand Airbnb’s tax regulations, including, “How does occupancy tax collection and remittance by Airbnb work?.” The site also has a list of locations where tax collection and remittance by Airbnb are available. On this list can be found 48 of the 50 states and the District of Columbia; the only two states not listed are Georgia and Hawaii.
The plaintiffs are seeking more than $5 million in damages, claiming “the practices complained of herein affect over one hundred counties and hundreds of municipalities and other government entities.” The lawsuit will attempt to represent any Georgian county or municipality in which Airbnb operates.