Airbnb warns about new law regulating online rentals will affect tourism
By the A.M. Costa Rica staff
Airbnb warns on the recently approved law No. 20.865 know as "the Law for the Regulating Non-traditional Rentals and its Intermediation Through Digital Platforms," will affect the tourist economy of Costa Rica.
According to Airbnb, short-term accommodation in Costa Rica plays a crucial role in the local tourism industry and the economy in general. "In 2018, Airbnb hosts in Costa Rica hosted 524,000 guests, contributing significantly to the local economy," they said their statement.
However, according to the online platform, the losses that will be generated throughout the community by new regulations will affect not only the hosts but also restaurants and other small local entrepreneurs who benefit from local tourism.
"Local hosts have communicated directly with Airbnb, fearful of the final impact this legislation will have on their ability to obtain additional critical income and support their families," said the firm.
According to Airbnb, the authorities did not consider taking into account the opinion of the people who offer rentals through this platform. Throughout this legislative process, the voices of these local hosts have not been heard in the discussion of the bill.
"The Ticos, who are the most affected in this process, were not invited to share their experiences and concerns," said the firm in its statement.
According to Airbnb, the Costa Rican Tourism Institute and municipalities should also consider the point of view of the hosts before proceeding with the implementation of this legislation.
According to the online rental platform, the firm has experience in tax agreements in 400 jurisdictions throughout the world. However, "current legislation does not provide adequate conditions to structure a similar instrument in Costa Rica." But, they said they are willing to collaborate with the authorities during the process of creating the law.
However, Airbnb made this public statement almost 15 months after this bill was presented for analysis by Congress. The bill was presented on June 18, 2018.
Airbnb's online platform for rentals was founded in 2008. According to its statistics, the platform has grown to more than 6 million customers in about 100,000 cities and 191 countries around the world.
More information about Airbnb and its position regarding the new law can be obtained by contacting the Public Relations Specialists: Adriana Zamora at phone (506) 8706-2076 or Email: firstname.lastname@example.org, as well with Andrei Siles at phone (506) 7107-5585 or his Email: email@example.com
Related to the new law, the Tourism Institute announced all owners of rental properties must register in the Institute's database, as A.M. Costa Rica previously reported on Monday.
The law defines a property for rent such as villas, houses, condo, and individual rooms, among others, offered on platforms such as Airbnb.
Also, the law requires owners to register at the Ministry of Finance, for the purpose of charging the 13 percent VAT (Value Added Tax) to their customers.
The law also requires owners of rental properties to register in the database of the municipality of their community to pay additional taxes.
This requirement applies to rental owners who have not been reporting or collecting taxes before.
According to María Amalia Revelo, Minister of Tourism, "this law will allow equal competition within the tourism sector among the lodging companies and guarantees an avant-garde step in terms of regulations to ensure greater protection for tourists."
According to the Institute, the Law requires owners to send a report of that database to the Ministry of Finance, "to proceed with the necessary control, investigation, and registration of commercial activity," said the Institute in its statement.
It is important to clarify that this new law is not enforced until it is published in the official government newspaper, known as La Gaceta.
According to the statistics of the Institute, during 2017, about 5.2 percent of tourists who enter via air, used rooms acquired by this type of platform, such as Airbnb. The percentage increased to 9.2 percent in 2018.
Since August 29th, the deputies of the Economic Affairs Committee approved the law to make non-traditional rentals pay taxes on their services and thereby increase government revenue while regulating commercial activity as well.
The project would apply to all tourist rentals in homes, apartments, villas, chalets, and bungalows, among others. As well as guaranteeing users security and protection when they purchase the service through the platform.
According to Deputy Roberto Thompson, the project represents a major boost to the tourism sector. "There is a very important segment of people who are using this type of accommodation in Costa Rica. Through this Law, we are trying to regulate and establish taxes and guarantee minimum conditions."
Related to this new law, the Chamber of Tourism, know as Canatur, celebrated its approval in the first round of votes.
"For the private sector, this step towards the regulation of lodging is extremely important," said Saray Valverde, president of Canatur.
For several years, Canatur has requested the regulation of this type of non-traditional lodging service.
According to the Chamber, this law will generate more tax revenue for the government, will protect tourists, and will create a level playing field for competition.
Regarding the issue of fair competition, the Chamber says that hotels, in addition to paying taxes, must invest capital in complying with specific rules and compliances to protect people with different abilities, while the informal hosting sites do not.
Should Airbnb leave Costa Rica tourists without alternative accommodation options? We would like to know your thoughts on this story. Send your comments to: firstname.lastname@example.org
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