Denmark, Germany, and Thailand: Lowering the Boom on Airbnb

by: The Knowledge Group

May 29, 2018


Danish tax minister Karsten Lauritzen appreciates the “sharing economy” as long as the sharers pay their taxes. Airbnb is blamed for grabbing business from hotels and B&Bs, and avoiding the tax collector.

So Denmark is poised to set a 70-day total annual cap on the number of days a property owner may list a space. And in a “world first” agreement, Airbnb will automatically report short-term rental payments to the Danish tax authorities.

There are some perks in the deal. The owner who rents out a summer home will, for example, be able to receive 40,000 Danish Krone ($6,300 USD) tax-free per year.

Hello, Airbnb Ireland? Germany Here…

Germany’s Ministry of Finance wants Airbnb to surrender all its information on German subscribers to get a grip on hotel and tourism tax evaders. It asked Airbnb Ireland for the information after failing to get it out of Hamburg, the U.S. company’s European headquarters.

Airbnb is expected to settle with the ministry itself, rather than subject its clientele to German tax audits. Yet this action may well prompt other European nations to go after Airbnb and various “sharing economy” corporations.

Airbnb is blamed for exacerbating housing shortages in many European cities as well as enabling de facto tax escapes. Berlin now prohibits the rental of entire apartments via Airbnb without a municipal registration.

Overall, Germany’s on a mission to make digital platforms pay their taxes to domestic jurisdictions, regardless of whether they lack a physical presence there.

One Night in Bangkok — Or Not

Meanwhile, two Thai condo owners have just lost the legal prerogative to rent out their rooms by the day or week via the Airbnb app to Thai and international guests.

Airbnb is highly active in Thailand, so the ramifications from a recent court ruling could be immense, reports the Bangkok Post.

The Thai Hotels Association wants the condo owners with Airbnb arrangements deemed illegal hotel operators.

Airbnb is a party to tax agreements with some 370 jurisdictions globally, and has collected and remitted nearly $600 million in tourism taxes.

Could this be a taxation trend that is repeated Worldwide? and how to protect yourself against tax penalties? Put your questions to our speakers at the live webcast discussing  best practice when defending civil and criminal tax penalties in 2018 and beyond.  Details can be found here, and a recording would also be available if you were unable to attend the live event on June 5. This webcast would also be eligible for Continuing Legal Education (CLE) credit.