A proposed class action filed by several Georgia municipalities claims Airbnb has failed to remit occupancy taxes to local governments despite purporting to collect such from customers. According to the suit, defendants Airbnb, Inc. and Airbnb Payments, Inc. have collected and remitted occupancy/excise taxes in “virtually every other taxing jurisdiction in the nation”—with the exception of Hawaii—yet have deliberately refused to comply with such tax obligations in Georgia.
The 30-page lawsuit begins by explaining that the defendants operate a short-term rental accommodations business through an online platform that allows “hosts” to advertise vacation and rental properties to customers, or “guests.” Pursuant to Airbnb’s terms of service, hosts and guests agree to pay the company certain fees, including a “service fee” and “any applicable Taxes,” for each transaction, the case alleges.
The suit claims that Airbnb, despite purporting to collect “taxes” from customers, has failed and refused to remit to Georgia cities and counties what’s known as occupancy or excise taxes. The lawsuit argues that under the Official Code of Georgia Annotated (OCGA), counties and cities may impose excise taxes at rates between three and eight percent on “the short-term rental of rooms, lodgings or accommodations in their jurisdictions.” Although the defendants allegedly abide by such contractual agreements in 48 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands, Airbnb has repeatedly refused to pay such taxes to Georgia jurisdictions such as the plaintiff cities and county, the suit claims.
According to the lawsuit, the plaintiffs sent several letters to the defendants—dated February 10, 2015, January 27, 2017, and January 23, 2019—in which they demanded that Airbnb fulfill its tax obligation, yet the company has either refused or failed to respond.
“Plaintiffs have repeatedly asserted that Defendants and their Guests and Hosts are obligated to collect and remit Occupancy Taxes for accommodation rentals in Plaintiffs [sic] jurisdictions and demanded that Defendants collect and remit Occupancy Taxes to Plaintiffs,” the complaint states. “Yet, Defendants have failed and refused to collect and remit the Occupancy Taxes owed to Plaintiffs and the Plaintiff Class.”
The lawsuit looks to certify a state-wide class of Georgia cities, counties and governments who “have enacted Occupancy Taxes on lodging.”