Airbnb to pay 576 million euros to settle some outstanding Italy tax obligations

VACATION rental platform Airbnb said on Wednesday (Dec 13) it will pay 576 million euros (S$834.6 million) to the Italian Revenue Agency to settle outstanding host income tax obligations for the 2017-2021 tax years.

Airbnb Ireland did not admit any liability as part of the settlement, which did not include assessments for 2022 and 2023 and the amounts for which could be “material”, Airbnb said in a regulatory filing.

The company said it was not seeking to recover the sum from its hosts.

Last month, a judge in Italy ordered the seizure of 779.5 million euros from Airbnb’s European headquarters in Ireland for alleged tax evasion.

The tax probe was related to Airbnb’s alleged failure to withhold 21 per cent of landlords’ rental income and pay it to Italian tax authorities, as required by a 2017 law, Milan prosecutors’ office said last month.

Airbnb had unsuccessfully challenged the 2017 law cited by prosecutors in a legal battle that ended in December last year with the EU Court of Justice ruling in the Italian government’s favour.

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Prime Minister Giorgia Meloni’s administration is planning a crackdown on tax cheating on short-term rentals, and wants to raise taxes to 26 per cent from 21 per cent for owners of multiple short-term rental properties.

Airbnb’s shares were up 1 per cent in premarket trading on Wednesday. REUTERS