HomeMy WebLinkAbout2017-12-12 PACKET 06.03.
TO:
Economic Development Authority
FROM:
Matt Wolf, Economic Development Assistant
DATE:
December 12, 2017
RE:
Airbnb and Lodging Tax
Background
At the October 10, 2017 Economic Development Authority meeting a discussion took
place on the implementation of a lodging tax in the City of Cottage Grove. As part of the
discussion an inquiry was made on how Airbnb and similar sites worked in regard to the
collection of lodging tax.
Discussion
The MN State Statute 469.10 gives cities the authorization to impose a three percent
tax on the gross receipts from lodging at a hotel, motel, rooming house, or resort. This
includes any facility that is not rented or leased over a continuous period of 30 days or
more.
The Cottage Grove City Attorney confirmed that Airbnb facilities do fall under the
provision of the MN State Statute as long as they are renting/leasing rooms for a term
less than 30 days. Airbnb does not collect local lodging taxes in MN from people
renting out their homes or rooms, so it is up to the owner of the property to collect and
remit the appropriate local lodging tax.
As a result the only way to verify that lodging tax is being submitted by Airbnb lodging
facilities in Cottage Grove is to actively watch their website and enforce through the
property’s owners.