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This home near Missouri State University is among the best-reviewed short-term Airbnb rental sites in Springfield. The booking company will now collect and remit sales taxes in an agreement with the state.
Photo courtesy Airbnb
This home near Missouri State University is among the best-reviewed short-term Airbnb rental sites in Springfield. The booking company will now collect and remit sales taxes in an agreement with the state.

Airbnb, Missouri reach tax agreement

Posted online

Last edited 12:59 p.m., Jan. 3, 2018

Missouri officials struck the state’s first deal with online short-term housing rental company Airbnb to collect and remit sales tax revenue.

Under an agreement with the Missouri Department of Revenue, Airbnb will begin collecting and remitting sales taxes Feb. 1 for short-term rentals offered through its website and mobile app. The San Francisco-based company announced the agreement this morning.

The agreement established a roughly 4.2 percent statewide sales tax rate on Airbnb bookings, as well as a variety of individual county and municipal sales tax rates, according to the company.

Greene County maintains a 1.25 percent general sales tax rate, according to county documents, and the city of Springfield has a 2.1 percent general sales tax rate, according to city documents.

“That’s why, A, this is so complicated and, B, it’s so important that we’re getting this done,” Airbnb spokesman Ben Breit told Springfield Business Journal. “It’s so complicated that it is totality unrealistic that a middle-class host would be able to figure this out.”

Beyond the consistent state sales tax, Breit said, “all of these additional taxes vary based on where you are, so it’s county by county, city by city, and these are just the taxes that are handled by the Department of Revenue.”

Airbnb recently announced its 6,300 Missouri hosts grossed nearly $30 million from 289,000 guests in 2017. Springfield ranked fifth statewide with local hosts collecting about $749,000 through 8,140 bookings.

If the same 12-month period were replicated under the new sales tax agreement, Breit said Missouri would have collected $1.1 million in additional tax revenue, considering just the new 4.2 percent state sales tax.

He said the company has been working with the state for a few months to iron out the taxing structure.

“It’s a big deal that we got this done, that Airbnb is going to be able to collect and remit all of these taxes automatically,” Breit said. “The hosts won’t have to worry about it, and I think we are all very confident that this is going to result in just a ton of new revenue for the state. It’s an issue that has always been there.”

About 350 other municipalities, counties and states made similar agreements with Airbnb, he said, including Iowa, Kansas, Illinois, Kentucky and Arkansas.

Breit said Missouri cities and counties with sales tax revenues that are not being collected by the state Department of Revenue still have to reach out to Airbnb for the company to collect and remit them.

“Any others that are interested in this, we want to hear from them, absolutely,” Breit said.

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