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Business News

Airbnb Transactions to Be Taxed in Connecticut

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Lauren Wellicome, Creative Commons
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Airbnb, the home rental site, is the latest e-commerce company to succumb to Connecticut's campaign to bring its tax structure into the 21st century.

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Credit Chion Wolf
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DRS Commissioner Kevin Sullivan

The website will now charge a 15 percent lodging tax on all rentals arranged in the state -- money which will be remitted to the Connecticut Department of Revenue Services. It's the same tax rate that's currently levied on hotel room stays in the state.

DRS Commissioner Kevin Sullivan has been in negotiations with Airbnb for months over the deal. He has long sought to follow transactions as they migrate onto the web.

The first high profile e-commerce deal Sullivan struck was with retail giant Amazon, which agreed five years ago to levy Connecticut sales tax on purchases made in the state.

The deal will affect about 1,800 people in the state who currently use the website to rent out their homes. It will also mean higher prices for the 50,000 or so people who use the service each year to book accommodation.

The company said that hosts in Connecticut earned about $3.5 million last year in rental income.

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