MEMPHIS – Airbnb, the world’s leading community-driven hospitality company, announced today a historic tax agreement with the City of Memphis that will allow the company to collect and remit taxes on behalf of its Memphis hosts.
With the tax agreement in place, the City will be able to fully capitalize on more people visiting Memphis and staying longer through home sharing. Effective June 1, Airbnb will automatically collect and remit local taxes for all Airbnb bookings in Memphis, making the process seamless and easy for both Airbnb hosts and the City.
The taxes include:
Memphis Short Term Room Occupancy Tax (3.5%)
Tourism Improvement District Assessment ($2 per bedroom per night)
“It’s important to our administration that government be able to work seamlessly with businesses and residents, and this agreement is evidence of that,” said Mayor Jim Strickland. “I especially thank City Council member Kemp Conrad, who worked so hard on this partnership. The economic impact of Airbnb speaks for itself, and I’m glad that so many people from out of town are experiencing the warm hospitality for which Memphians are well known.”
Airbnb has partnered with hundreds of governments throughout the world to collect and remit taxes, and this marks the company’s first tax agreement in the State of Tennessee.
“Home sharing is introducing a whole new world of travelers to the authenticity of Memphis while offering a unique economic opportunity for hundreds of Memphis residents,” said Laura Spanjian, Tennessee policy director for Airbnb. “We are so proud to have collaborated on this deal which will unlock new annual tax revenue for Memphis.”
The agreement comes at a time of dynamic home sharing growth within Memphis, where 300 residents share their homes on the Airbnb platform. In 2016, those hosts earned $3.9 million in supplemental income while welcoming approximately 40,000 guests to the City.
The typical Memphis host earns about $8,000 annually via Airbnb. Hosts in Memphis often utilize this supplemental income to take care of their mortgages, pay student debt or save for retirement.
46% of Memphis Airbnb hosts simply rent out an extra room in their homes. Commonly these are empty nesters whose kids have left the home.
Home sharing has been particularly beneficial to Memphis by expanding lodging capacity during large events that cause hotels to sell out. Just this past weekend during the Beale Street Music Festival, Airbnb hosts welcomed an additional 1,700 guests to the city. Airbnb projected a $1 million economic impact for Memphis based on host income and guest spending with local merchants during the festival.
Founded in 2008, Airbnb’s mission is to create a world where people can belong when they travel by being connected to local cultures and having unique travel experiences. Its community marketplace provides access to millions of unique accommodations from apartments and villas to castles and treehouses in more than 50,000 cities and 191 countries.