Missouri, Airbnb announce revenue-sharing state sales tax deal

As Kansas City wrangles with its own short-term rental rules, Airbnb and the Show Me State announced an agreement Wednesday that will allow the home-sharing giant to collect and remit taxes on behalf of 6,300 Missouri hosts.

Effective Feb. 1, the tax agreement with the Missouri Department of Revenue adds a state sales tax — now at about 4.2 percent — as well as a variety of local taxes on all Airbnb bookings in Missouri.

Based on 2017 Airbnb revenue, it would translate to about $1.1 million in tax revenue to Missouri, according to Airbnb.

“Home sharing is introducing a whole new world of travelers to the authenticity of Missouri while offering new economic opportunities for thousands of middle-class Missourians,” said Laura Spanjian, Midwest policy director for Airbnb. “We are so proud to have collaborated on this agreement, and we believe this can serve as a model for other states. We are dedicated to finalizing additional agreements to collect and remit taxes with Missouri municipalities.”

Airbnb has partnered with 350 local governments throughout the U.S. to collect and remit taxes, including Kansas, Iowa, Illinois, Kentucky and Arkansas. It collected and remitted more than $240 million in hotel and tourist taxes throughout the world.

The Airbnb agreement — which is the company’s first tax deal within Missouri — comes amid the City of Kansas City, Missouri’s roughly three-year attempt to draft its own regulations for short-term rentals. Currently, it is illegal for residents in the City of Kansas City, Missouri, to offer their homes up for short-term rentals via services like Airbnb or VRBO.

Short-term rental hosts and the area’s tech industry have largely been opposed to the city’s drafted regulations, which impose new fees on hosts and require property neighbors’ consent. Airbnb is working with city officials on drafting laws and is encouraging the city government to allow for the taxation of short-term rentals.

Kansas City Mayor Sly James’ office praised the Missouri tax agreement, noting that the city is working to find the appropriate regulations.

“This shows the high level of cooperation home-sharing platforms, like Airbnb, are seeking with government jurisdictions,” said Joni Wickham, Kansas City Mayor Sly James’ chief of staff. “As we review sharing economy growth, home-sharing is an example of an opportunity for homeowners to monetize assets that would otherwise be idle. In Kansas City, we are seeking to balance the interests of neighborhoods and property owners seeking to use home-sharing platforms.”

Despite the illegality of such home-sharing operations, Kansas City remains a popular destination for Airbnb guests. More than 75,000 visited via Kansas City Airbnbs in 2017.

St. Louis is the most popular locale for Missouri’s Airbnb guests, followed by Kansas City, Branson, Columbia and Springfield, according to Airbnb. In total, Missouri’s Airbnb hosts earned about $28.9 million in 2017 and welcomed 289,000 guest arrivals to the state, according to the company.