The House and Senate have reached an agreement to regulate and tax short term rentals, like Airbnb. Perhaps most importantly, the bill preserves local control, giving cities and towns wide latitude to regulate short term rentals. Preserving local control is critical because cities and towns across the Commonwealth have different concerns, and even within Boston, the impacts are different from neighborhood to neighborhood. By requiring registration of short term rental units, municipalities will be able to collect the data needed to better understand the impacts on different neighborhoods.
This bill would:
- Tax short-term rentals and accommodations rented through hosting platforms like Airbnb at the same uniform tax rate imposed on stays at traditional brick-and-mortar lodging accommodations like hotels/motels/bed & breakfast establishments. These taxes include: the room occupancy excise of 5.7%, the local option excise of up to 6%, and convention center financing fee of 2.75%, and will be assessed on short term rentals and accommodations rented through an intermediary/hosting platform.
- Maintain an exemption for owner-occupied bed & breakfast homes that rent out fewer than 4 bedrooms.
- Preserve local control and ensure cities or towns are empowered to regulate operators of short-term rentals.
- Cities and towns may:
- Regulate the existence or location of operators of short-term rentals.
- Regulate the class of operators and number of local licenses or permits issued to persons operating accommodations, and the number of days a person may operate and rent out such accommodations in a calendar year.
- Require health and safety inspections.
- Require licensing or registration of operators.
- Establish a reasonable fee to cover costs associated with the administration and enforcement of regulating operators and accommodations.
- Require operators of short-term rentals and hosting platforms to maintain appropriate levels of insurance coverage.
- Require operators of short-term rentals to register with the Department of Revenue to obtain a tax certificate.
A more detailed summary of the bill, prepared by Sen. Rodrigues’ office, can be seen here.
Chief of Staff
Office of Senator William N. Brownsberger
Update from Will B. on Monday, August 6
The Governor has sent the bill back with a message proposing amendments. The message can be downloaded as a pdf from this page. When the Governor sends back a bill with amendments, it does not take effect. It comes back to us. But once it is back with us, it will require unanimous agreement to return it to him (since we are in informal sessions and roll call votes are not available). This bill is controversial and unanimous agreement is unlikely. So, the future of the bill is in doubt. If a bill does go back, it will be the product of a renegotiation with a different power balance (reflecting the requirement of unanimity) and may look different.
It is likely that this situation will stay in flux into the next session.