Victoria: Demands surge to exclude Airbnb from new levy

Airbnb will lobby the Victorian government to exempt private room bookings and other forms of “budget accommodation” from the recently-announced 7.5% fee on short-stays, and the company has warned other states against immediately following Victoria’s lead.

Michael Crosby, who is the head of public policy for the company in Australia and New Zealand, spoke at a media event on Wednesday morning and said he was “disappointed” that the fee will only apply to short-stay platforms. Previously, he had advocated for a tax of between 3 and 5 percent on all housing providers.

The tax is scheduled to go into force in 2025, at which point it will bring in approximately $70 million per year to fund social and affordable housing.

Crosby stated that Airbnb fully supports anything that is going to lift the general supply of housing. “It is a very worthy aim that the government has earmarked this revenue for new homes – Airbnb definitely supports anything that is going to lift the overall supply of housing,” Crosby added.

“However, we have stated that the levy would raise a lot more money and cost customers less if it was completely accommodation agnostic and applied to any kind of accommodation.”

During the next step of the consultation process, which will entail the establishment of a working group for the industry, Crosby stated that Airbnb will make an effort to persuade the government to reduce the charge for low-cost accommodations.

Airbnb could not disclose any numbers on the number of private rooms that are posted in the province of Victoria; however, the company did state that globally, private rooms make up more than 15% of its 6.6 million listings.

Crosby stated that “the 7.5% levy will have a disproportionate impact on budget accommodation,” noting that the average price of a private room on Airbnb is approximately $104 a night. He went on to say that “the levy will have a disproportionate impact on budget accommodation.”

“We want that… option to be available for those who are traveling on a budget or for folks who are looking for accommodations that are affordable.

“One of the things that we wouldn’t mind exploring with the government is whether there could be a tiered structure, maybe a threshold where it lifts to a higher rate.”

In an effort to obtain comment, the Victorian government has been contacted.

Airbnb, according to Deborah Di Natale of the Council for Homeless Persons, has only ever been a choice for short-term lodging, and the Council is pleased with the decision of the government to implement the “moderate” charge on the platform.

“Airbnbs have meant that there are less long-term rentals on the market, and what we need is as many rentals as we can get across the state,” she added. “What we need is as many rentals as we can get across the state.”

During a time of severe housing shortage, any new plan that the government can enact to open up new avenues of financial support for the construction of additional homes is very much appreciated.

At a separate press conference on Wednesday, the Minister of Tourism, Steve Dimopoulos, stated that the exception for hotels would not be reexamined by the government.

He explained, “Airbnb provides a valuable service to a number of communities across Victoria, but at the same time, it does take away housing stock.”

The tax that was placed on Airbnb was implemented with the intention of redirecting some of the market’s focus back to what consumers really want, which is a place to call home. It is irrelevant to regulated accommodations such as hotels or serviced flats; there is no connection between the two. They offer a completely different service than everyone else.”

The day after Victoria announced the levy, the premier of New South Wales, Chris Minns, and his treasurer, Daniel Mookhey, stated that they were open to the idea of implementing a similar measure in order to encourage property owners to place their homes back on the market for long-term rentals.

Mookhey issued a directive to Treasury to investigate Victoria’s 7.5% tax and investigate the impact of measures of a similar nature in other countries.

Crosby stated that he was aware that other states were also keeping an eye on Victoria’s development.

“Whether or not there are any firm proposals on the table from other states and at the moment, I don’t think I’ve seen any, but they are super interested in what Victoria is doing,” he added. “Whether or not there are any firm proposals on the table from other states and at the moment, I don’t think I’ve seen any.”

“But we want to make sure that other state governments are aware of that as well,” we said. “If there is that negative impact as a result of the levy, then that is something that other state governments should be aware of.”