New law impacts short-term vacation rentals

By Judy J. Beasley Last updated Feb 26, 2022

SAVANNAH, Ga. (WTOC) – The Hostess City is gearing up to welcome thousands of visitors for the holiday weekend, all looking for a place to stay.

But a new state law could mean they shell out extra money depending on where they book their vacation.

The new law introduces new fees for anyone renting through websites like Airbnb and VRBO. A $5 per night lodging tax that hotels and motels already charge their guests.

The president and CEO of the Tourism Leadership Council of Savannah says the new law levels the playing field between short-term vacation rentals and traditional lodging.

“In many ways it is. First, for the first time, the $5 hotel/motel fee will now apply to all short-term vacation rentals and hostels with less than five rooms,” said Michael Owens.

Another piece of the new law also states that short-term vacation rentals must also pay local excise tax, which Owens says has already happened in Savannah.

“We have truly extraordinary compliance with short-term vacation rentals operating here paying all appropriate taxes. A lot of that has to do with the work we did with the city and stakeholders several years ago,” Owens said.

Owens adds that the new fee for STVRs is not a tax on business, but rather on the visitor.

“Of course that visitor is helping out in our community, generating millions and millions of dollars that pay for roads locally, pay for police, fire, essential services that we all use,” he said. A couple visiting from the Dallas area stayed in two vacation rentals last week through Airbnb. They say new fees won’t stop them from booking through the service again.

“Absolutely not. We had a great experience, we love Airbnb. The privacy and the ability to cool off as well,” Bev Ozanne said.

“So that’s the trade-off is that when we have an Airbnb, we can do our own cooking for breakfast and lunch,” Steve Ozanne said.

So what kind of revenue generator is the hotel motel tax for Savannah? According to the latest available report, the city raised $22.5 million in 2019.