It just got a bit more expensive to rent some vacation properties in Osoyoos.
The BC government has reached a deal with online vacation rental provider Airbnb that will see the company start to collect provincial sales taxes on all short-term rentals conducted through its platform.
The agreement will help fund provincial housing affordability measures, Finance Minister Carole James said.
“British Columbians want access to the sharing economy – and they want it to be fair,” Ms. James said in a release. “This initiative will provide additional revenues to address housing affordability, and it improves tax fairness for all British Columbians.”
It will also add dollars to local tourism marketing efforts.
Once legislative and regulatory changes are made, Airbnb will begin collecting the 8 per cent provincial sales tax (PST) and the up-to-3 per cent municipal and regional district tax (MRDT) on short-term accommodations provided in British Columbia through its platform.
The province says there are about 18,500 Airbnb providers operating in British Columbia and estimates Airbnb will remit approximately $16 million through the PST and an additional $5 million through the MRDT.
According to Destination Osoyoos, Osoyoos has almost 140 Airbnb hosts.
“The same properties are also listed on VRBO,” said Kelley Glazer, DO’s Executive Director.
Airbnb hosts in Osoyoos offer everything from private rooms and guest suites to bungalows and even motorhomes.
Although she expects similar provisions will eventually engage VRBO, Ms. Glazer doesn;t expect that to happen soon.
“This plan will take some time to put in place as there are so many loose ends that will need to be addressed,” she said. “We will likely not see any changes for a year or so.”
To streamline the process of collecting taxes, Airbnb will remit on behalf of its hosts in British Columbia, ensuring that no additional administrative burden is placed on them.
“This is a defining moment for Airbnb in British Columbia,” said Alex Dagg, public policy manager for Airbnb in Canada. “These changes are a welcome opportunity to continue helping the province and its residents benefit from the positive economic impacts of home sharing.”
This is the first arrangement of its kind in British Columbia.
Airbnb is a leader in its sector for coming to the table with the Province, and agreeing to voluntarily register its platform to collect the PST and MRDT.
In the near future, the Province will be looking to move forward with similar arrangements with other accommodation platforms, including VRBO.