SANTA CRUZ SENTINEL
Santa Cruz County Supervisors to vote on lodging tax rules
The house at 3031 Pleasure Point Drive is listed on Airbnb as a vacation rental. Santa Cruz County Supervisors meet Tuesday…
The house at 3031 Pleasure Point Drive is listed on Airbnb as a vacation rental. Santa Cruz County Supervisors meet Tuesday to change the vacation rental laws mandating property owners in the unincorporated areas must include their tax certificate number on all advertising “” such as Airbnb and VRBO “” enabling the county to collect the 11 percent lodging tax. (Dan Coyro — Santa Cruz Sentinel)
By Samantha Clark, Santa Cruz Sentinel
Posted: 06/20/15, 2:19 PM PDT | Updated: 2 weeks ago
Owners of this one-bedroom condo at 610 14th Ave. in Live Oak advertise on VRBO for $225-$275 per night. Santa Cruz County…
Owners of this one-bedroom condo at 610 14th Ave. in Live Oak advertise on VRBO for $225-$275 per night. Santa Cruz County Supervisors meet Tuesday to change the vacation rental laws mandating owners in the unincorporated areas to place their tax certificate number on all advertising “” such as Airbnb and VRBO–enabling the county to collect the 11 percent lodging tax. (Dan Coyro — Santa Cruz Sentinel)
SANTA CRUZ >> Online reservation services help people rent spare rooms or houses to travelers for easy money. But collecting hotel taxes for short-term rentals often requires extra steps that are also easy to skip.
Like other cities and popular tourist destinations, Santa Cruz County knows many hosts listing their properties are skirting the law and not paying their 11 percent lodging or transient occupancy taxes. Tracking down the scofflaws has proven to be an exhaustive challenge due to the ballooning business.
Now just in time for the summer vacation season, the county is looking to change its vacation rental law to aid in collecting transient occupancy taxes.
The Board of Supervisors is set to vote Tuesday on the rule change that will require hosts to include their tax certificate number on all forms of advertisements, including their online listings. The board approved a first reading of the proposed law, which other cities and counties already require, earlier this month.
So when Mary Jo Walker, who among her roles is the county tax collector, scrolls through vacation rental profiles on sites such as Airbnb, HomeAway and VRBO or sees an ad on a flier, she can easily look up who’s paid.
“It’s not fair that some people add 11 percent to their nightly rate and pay the tax and other people don’t,” she said.
Though many vacation rental hosts and owners pay, especially those using property management companies, she said. However, some hosts are unaware of the requirement.
Tara Gasta rents a room in her Pleasure Point house on Airbnb. She lets guests know on her web listing that she collects the lodging tax when they check in.
“It just makes sense to me that if the hotels charge tax, then I charge a tax,” she said. “This better levels the playing field.”
The county isn’t alone about getting more serious about enforcement. With the growth of reservation websites, some jurisdictions nationwide are starting to crack down on regulations over worries about losing affordable housing stock to swelling short-term rentals and missing out on the tax revenue.
In next year’s budget, the Auditor-Controller-Treasurer-Tax Collector Office asked to hire an additional auditor to spend half time doing transient occupancy tax audits. And if the Board of Supervisors approves the new rule, the county will kick off an outreach campaign to let people know that they need to pay their taxes.
“It’ll be a light touch at first,” Walker said about penalties, “but were trying to just get what the county’s owed. These are taxes that go into the general fund.”
Different than other sites, Airbnb collects the rental payment from the guests but leaves it up to the hosts to collect and remit the lodging tax themselves. The county recently started negotiating with Airbnb, asking that the company also collect the tax on behalf of the hosts “” as it does in San Francisco and San Jose.
If Airbnb agrees, then the company would hold the transient occupancy tax certificate and would manage the number that would be listed on advertisements, Walker said.
The cities of Santa Cruz, Capitola, Scotts Valley and Watsonville have expressed interest in teaming up with the county in asking Airbnb not only to collect the lodging tax going forward but to deliver the back taxes, too.
Other proposed changes to the transient occupancy tax law include imposing a $25 fee for hosts who hold a certificate but don’t file the monthly return or rent the facility during the month. The county would also be able to revoke a certificate if the host refuses to file returns or files fraudulent returns.
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