A bill to be introduced at the City Council on Monday would apply the city’s 9.5 percent hotel tax to Airbnbs and other short-term rental properties, and would require all operators to obtain a license from the city.
The bill is set to be formally introduced at the council’s meeting Monday by City Councilman Eric Costello and City Council President Bernard C. “Jack” Young.
Costello said that the city’s Department of Finance would handle the licensing process, and that any operator looking to rent out a space would need to obtain the license before making the posting public online. Any operator caught violating any of the city’s codes — fire, housing, etc. — could have their license suspended or revoked.
The exact process for obtaining a license will be worked out after the bill is passed, Costello said.
Costello said the No. 1 motivating factor behind introducing the bill was the missing tax revenue. When visitors to the city stay in a short-term rental like an Airbnb, the city does not see the money it would otherwise receive had the person stayed in a hotel room.
“First and foremost, there’s tax revenue that we’ve left on the table and that these are transient operators, so they should be paying the hotel tax,” he said. “I could tell you that I support short-term rentals as an operation. What I don’t support is scenarios where we have investors who purchase dozens and dozens of these properties and turn neighborhoods into transient neighborhoods.”
Airbnb was critical of the bill in a statement, saying: “The hotel industry’s proposed regulations are designed with one thing in mind: protecting historic hotel profits and the ability of big hotels to price gouge during popular weekends in Baltimore.”
Amy Rohrer, the president of the Maryland Hotel & Lodging Association, said in a statement that her organization supports the bill.
“Baltimore has a vibrant tourism industry and the hotel occupancy tax contributes significantly to public education and public safety in the city of Baltimore,” she said. “Allowing commercial real estate investors who place their properties on Airbnb to avoid the same taxes is simply not fair.”
A recent report from Airbnb found that, statewide, at least 5,500 residents welcomed an overnight guest through Airbnb in 2017, accounting for $42.4 million in profits for those hosts.
The City Council and Maryland General Assembly took up bills in 2016 that would have taxed short-term rental sites like Airbnb, but both eventually fizzled out.
Costello said he was “confident” that this bill was going to garner enough support from his colleagues to be passed.