Airbnb Settles Tax Dispute in Italy, Agrees to €576 Million Payment

16 Dec, 2023

Airbnb Settles Tax Dispute in Italy, Agrees to €576 Million Payment

Airbnb, the short-term rental giant, has reached an agreement to settle a prolonged tax dispute in Italy, culminating in a payment of €576 million. The resolution comes after Italian prosecutors highlighted approximately €779 million in unpaid short-term rental taxes owed by Airbnb for its Italian landlords between 2017 and 2021.

In response, Airbnb stated that it wouldn't seek reimbursement of the settlement amount from its hosts. The company revealed plans to roll out new tools empowering hosts to automatically withhold and remit taxes to the Italian tax authorities. This move aims to ease the tax compliance burden for hosts on the platform.

Addressing the core of the matter, Airbnb emphasized that the majority of its hosts in Italy are regular families supplementing their income. The company expressed optimism that the agreement with the Italian Revenue Agency and recent legislative adjustments would offer these families a clearer understanding of hosting regulations in the years ahead.

The Court of Justice of the European Union's 2022 ruling permitted member nations to mandate short-term rental platforms to collect income taxes. Airbnb welcomed the Italian government's delineation of tax withholding guidelines for non-professional hosts in the upcoming budget law, aiming to streamline income tax collection processes.

Italy, a crucial market for Airbnb, houses tens of thousands of hosts leveraging the platform for property rentals. With the Italian government's commitment to addressing tax evasion associated with short-term rentals and considering a tax rate increase from 21% to 26% for owners, Airbnb vows to collaborate with authorities to ensure compliance and effective policy solutions, particularly in historic centers like Venice and Florence.