Florida Supreme Court to Decide Fate of “Resort Tax” on Vacation Rentals

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  • Photo via Airbnb
  • An Orlando vacation rental property listed on Airbnb

A battle over whether Airbnb and similar vacation rental platforms are required to collect and send county tourism development taxes could be decided by the Florida Supreme Court.

Palm Beach County Tax Collector Anne Gannon is asking judges to take up the matter after a divided appeals court ruled in March that online companies are not required to manage so-called “Bed taxes,” according to documents released Monday on the Supreme Court. website.

As is common, an initial notice filed by Gannon’s attorneys did not provide details of the collector’s arguments. But she is seeking the Supreme Court to overturn a decision by a panel of the 4th District Court of Appeals in favor of Airbnb, Tripadvisor and HomeAway.

The dispute is over tourist taxes that counties can impose on short-term rentals, with the money going for tourism-related purposes. Hotels, for example, collect taxes on guest bills and remit the money.

But in a decision 2-1, the court of appeal agreed with online platforms that they are not subject to the requirement. The platforms accept payments from tenants and pass the money on to owners, serving as a sort of intermediary for vacation rentals.

On March 25, the majority of the appeals court rejected Gannon’s arguments that the platforms should be considered “resellers” under state law, a description that would require them to collect and to pay taxes. The ruling said that a concessionaire is “one who can grant a right of possession over the property.”

“Based on our … determination that the companies are only intermediaries and have no rights of possession over the properties, the companies are not ‘resellers’ as provided for in the (county) ordinance and the … statutes, ”reads the decision, written by Court of Appeal Judge Dorian Damoorgian and joined by Chief Justice Spencer Levine. “Rather, a ‘concessionaire’ is the owner of the property, or the owner’s agent, who ultimately receives consideration.”

The appeals court last month rejected a request for a new hearing, including a possible rehearing by the full court.

But in a dissenting opinion in March, Judge Robert Gross focused heavily on parts of state law that say the “person receiving consideration” for a lease or rental is responsible for the collection and disposal. payment of taxes. Citing laws, ordinances and a state administrative rule, he wrote that online platforms receive rent payments and, therefore, are responsible for processing taxes.

“The impact of these laws, ordinances and rules is crystal clear,” Gross wrote. “The law focuses on that ‘magic moment’ when a person comes into possession of a rent payment, which triggers that person’s obligation to collect the (tourism development tax) and remit it to the competent tax authority. Airbnb and TripAdvisor are both considered agents who “collect rent as representative of the owner” within the meaning of (the administrative rule). The companies’ terms of service provide that they will act as payment collection agents to receive funds from customers.

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