Airbnb, the short-term rental platform, has reached an agreement to settle a longstanding tax dispute in Italy by paying €576 million (approximately $621 million).
The dispute stemmed from unpaid taxes related to short-term rentals in Italy between 2017 and 2021.
Italian prosecutors had previously asserted that Airbnb owed roughly €779 million (about $840 million) in short-term rental taxes, which the platform had failed to pay on behalf of Italian landlords during that period.
In response to this settlement, Airbnb stated its commitment not to seek reimbursement of the settlement amount from its hosts.
Instead, the company intends to introduce new tools that will automatically withhold taxes on behalf of hosts and remit them to Italian tax authorities.
Airbnb emphasized that the majority of its hosts in Italy are ordinary families using the platform to supplement their income.
The company hopes that this agreement, along with recent legislative changes, will bring clarity to hosting rules for these families in the years to come.
The Court of Justice of the European Union ruled in 2022 that member countries could require short-term rental platforms to collect income taxes.
Airbnb expressed its support for the clarity provided by the Italian government’s 2023 budget law, which outlines the procedures for withholding income taxes for non-professional hosts in Italy.
These measures are expected to facilitate the monitoring of short-term rentals in historic cities like Venice and Florence, enabling the development of appropriate policy solutions.
Airbnb has pledged to collaborate with Italian authorities to ensure the successful implementation of these rules.
Italy remains a crucial market for Airbnb, with tens of thousands of hosts utilizing the platform to rent their properties.
The Italian government, led by Premier Giorgia Meloni, has expressed its commitment to combat tax evasion related to short-term rentals and plans to increase the tax rate for property owners from 21% to 26%.
