Airbnb Agrees to Settle Italian Tax Probe, to Pay €567 Million

Airbnb has agreed to pay €576 million to the Italian tax authorities to resolve accusations of tax evasion from 2017 to 2021. Despite Italian authorities having previously seized €779 million from the company, Airbnb has confirmed it will not recoup the settlement amount from its hosts. The company highlighted the importance of the Italian market and its continued cooperation with local authorities.

In Italy, Airbnb hosts, primarily ordinary families seeking extra income, earn on average €3,500 annually. This income is key for many, aiding almost two-thirds of them in making ends meet.

The Italian government is cracking down on tax evasion in the short-term rental sector, introducing measures like a national identification code for tourist accommodations to ensure proper tax declaration. Foreign Minister Antonio Tajani noted that increased tax rates would apply only to owners renting out more than one property, and mainly affect those with multiple short-term rentals.

Currently, owners can choose a flat tax rate of 21%, but under proposed laws, this will increase to 26% for each additional property rented for under 30 days. Airbnb is preparing for these changes by developing new tools to automatically withhold and remit taxes for hosts to the Italian Revenue Agency.

The company also acknowledged complaints from the hotel industry about short-term rentals causing higher rents and housing shortages in tourist areas, and it is ready to adapt to the updated Italian tax laws.