Thousands of rateable Airbnb properties not on Auckland Council books as industry slams new policy

Friday, 13 July 2018

Auckland Mayor Phil Goff says he has agreement from Airbnb that a new tax for online accommodation providers is 'the appropriate thing to do'.

Thousands of properties liable to pay Auckland's new Airbnb rate are missing from the council's books.

Meanwhile, tourism industry representatives have attacked the new policy for falling 'dismally short' of its aim to level an uneven playing field within the accommodation sector.

The council has extended the accommodation provider targeted rate (APTR) and business rates to some properties listed on Airbnb and Bookabach.

New figures released to Stuff show 1118 online providers are loaded in the council's database to pay the APTR.

**READ MORE:

Tourism Industry Aotearoa chief executive Chris Roberts' biggest concern is Auckland Council's inability to implement its own rating policy

* About 1100 to pay Auckland Council's Airbnb rate after 26,000 letters sent out

* Auckland Council cannot find all online accommodation providers subject to new rates

* Auckland council targets Airbnb and Bookabach properties for higher rates**

However, the council estimates up to 3800 – an additional 2682 – are liable to pay some level of the APTR.

'We are leading with the policy change this year and expect the number of providers identified to grow as we progressively identify more of the properties being used for short-term accommodation purposes,' a spokesman said.

Thousands of Airbnb properties liable to pay Auckland Council's extended APTR rates are missing from the Auckland Council's books.

Tourism Industry Aotearoa (TIA) has criticised the new policy, saying it 'falls dismally short of the mark and fails to reduce unfairness for traditional accommodation providers'.

Chief executive Chris Roberts said TIA's 2017 submission, which opposed the APTR, stated it would be difficult to extend the targeted rate to online accommodation providers.

This had proven to be the case, he said.

Roberts' biggest concern was Auckland Council's inability to implement its own rating policy – the council last week conceded its staff could not find all the providers who should be paying increased rates.

'TIA certainly agrees with the council that it is an 'unfortunate' shortcoming of the new rating policy that the council cannot find everyone who should be paying it,' Roberts said.

Last week, Auckland Council said 1172 properties would have their rates changed under the new policy, however the figure was subject to change.

'But according to Auckland Council's report 'Airbnb and Housing in Auckland' there are 12,357 properties available on Airbnb in the city – and that number is growing all the time,' Roberts said.

'The council is expecting payment from just 9 per cent of Auckland's Airbnb providers.'

TIA also questioned why room-only Airbnb bookings were excluded from the new policy.

Of 12,357 Airbnb listings region-wide, 49 per cent were for an entire house, 49 per cent offered private rooms and 2 per cent advertised shared rooms.

'Exempting the room-only providers excludes a significant proportion of the market, as it can be reasonably assumed that some of these room-only providers are generating significant annual income,' Roberts said.

'Our view is that to achieve fairness and spread the rate burden, room-only providers should also be included.'

Auckland Council's financial policy manager, Andrew Duncan, said 68 per cent of those who responded to the consultation on whether to apply business rates to the online accommodation sector supported the idea.

'Through this consultation, the commercial accommodation sector expressed their concerns to us about the uneven playing field between commercial accommodation providers and properties let for short-term accommodation, such as Airbnb and Bookabach,' Duncan said.

'Their concern was that it is unfair that someone using their property commercially in competition to a hotel or motel operator pays lower rates.

'We have listened to their concerns and have decided to make rates fairer. We have taken care to develop a system that reflects the scale of the commercial operation being undertaken so that levels of rates charged are commensurate.'

Of the 1118 properties in the council's system, 81 were booked between 29 and 135 days a year, eight were booked between 136 and 180 days and 1029 for more than 180 days.

Under the new policy, properties booked between 29 and 135 nights year paid 75 per cent residential and 25 per cent business rates, plus 25 per cent of the APTR rate.

Accommodation booked for more than 135 nights would be rated as a business and would pay the full APTR rate.

The council estimated there were 8,000 Airbnb properties where the entire dwelling was let. However, that included houses in areas outside the APTR zone.