Airbnb agrees to pay back taxes

    Efforts by Campos mean city will now collect tens of millions of dollars for the General Fund

    48hillscamposheadshot

    By Tim Redmond

    FEBRUARY 18, 2015 – Airbnb has agreed to pay the city tens of millions of dollars in back taxes, Sup. David Campos told me today.

    The decision by the multibillion-dollar company is a huge victory for the district 9 supervisor, who refused to give up on the issue even after losing 6-5 the first time he introduced a measure mandating the payment.

    With a new supervisor on the board, who is facing the voters this fall, and growing grassroots pressure on the company, Airbnb apparently decided it could no longer duck the bill.

    The issue would have been part of the campaign to pass a ballot measure better regulating short-term rentals this fall, although that measure is going to deal with land use, not taxes.

    “A lot of people said we should let go of this,” Campos told me. “But it’s going to mean millions of dollars for the General Fund.”

    Campos had introduced legislation that would suspend the legalization of short-term rentals until the city treasurer certified that all back taxes were paid.

    The company, and other short-term rental platforms, still have a serious problem in San Francisco: Only a tiny number of hosts have signed up for legal registration. The vast majority of the current listings are now illegal.

    Gina Simi at the City Planning Department confirmed this to me today:

    Residents cannot engage in short-term renting without obtaining a Short-Term Residential Rental Registration Number, regardless of whether they have an appointment scheduled or an application under review. It’s also important to note this ordinance does not override any lease agreements or any other agreement, law, or regulations that prohibit subletting or use of a unit as a short-term residential rental.

    So there are thousands of illegal rentals going on today.

    • W.C. Whiner
    • But – but – SOCIALISM!!!

      • Guest

        If the voters wanted socialism they would have elected Campos over Chiu.

        They did not.

        • W.C. Whiner

          Campos means well, but that he appeals to socialists is risible.

    • Stan J.

      Will they will pass the back taxes on to the hosts?

      • Guest

        No, but they will calculate their own number for the taxes due, which I suspect is cheap to derail all the hysteria.

    • guest

      Feinstein and the others helped to carry the water, it was not Campos alone that made this happen

      • Yul Ullu

        But Campos was the tireless voice on this. He deservedly gets credit.

      • jjfieber

        Don’t worry, Ed Lee is already claiming credit too. It’s a back patting dogpile!

        • jch

          That sure doesn’t square with Lee’s public positions on this. It’s a case of, “There go my people. I must follow them for I am their leader.”

          • Guest

            Ed Lee is a consummate politician, who probably did broker this deal. Campos is trying to take the credit but nowhere do I see anything indicating that he was a factor. He just whined a lot, in that way whiney way that he does.

            • Yul Ullu

              I don’t know if Lee did anything, but if he did it was 100% because of Campos and the threat of this getting on the ballot.

            • Sam

              It was the tax collectors job to collect tax that is due. This was politicized but it was never apolitical issue – just a collection issue.

    • Yul Ullu

      My guess is that they hired someone to conduct ‘focus groups’ and found out that most people agree that they should be required to pay back taxes. I participated in a poorly crafted on-line survey that asked these questions.

      Also, AirBnB’s accounting on this needs to be open to the public as well..

      • mark

        Yul Ullu, arent you the one who designed Mame Dennis’ modern couch?

        • Yul Ullu

          Good catch!

      • Guest

        Yul, I doubt that most voters care a fog about this either way. It’s been a relatively small number of people making a lot of noise AKA a rabble.

      • jch

        I wonder how much we’ll get out of it. We had a strong bargaining position when the Airbnb legalization measure was before the supervisors. My guess is that Airbnb will walk away with a smaller tax bill than Campos and his colleagues were asking for then and which was rejected by six supervisors and Mayor Lee.

        Still kudos to Campos. He took the city’s losing position and turned it around.

        • Dave

          Here’s a thought…just to play devil’s advocate.

          Maybe they should pay what they actually OWE, not what we want them to pay. What happened is that that Treasurer Cisneros did an analysis and presented Airbnb with a number two weeks ago.

          What were they supposed to pay according to Campos? Some number that he read in a Chronicle article? He never did the hard work of figuring out how much the liability was; it’s not a skill that you learn at Showboating University.

          • Guest

            Agree, Campos politicized this when it was really just a matter between Airbnb and the tax collector.

            Campos passed on specific law about this and nor was any necessary. He’s an opportunistic egotist and needs to go away

            • Why won’t you use your name? I’m so tired of people lobbing mudballs over the fence and running away. If you want to have a conversation, do so.

            • Guest

              How do we know you are using your real name?

              You should be able to debate an issue without having all my personal information.

    • Airbnb made a business decision for tax reasons. Tax penalties are not deductible.

      • Guest

        I suspect the deal is that airbnb will compute the tax due, since only they have the records. By offering to pay a flat rate, they can avoid any kid of full audit that might reveal that far more is due.

        And the sum involved is trivial for a large successful enterprise like them, and in return they got a sweeter deal from SF than some other cities are trying to foist on them.

      • Guest

        Tax penalties are often deductible, which is why so many large companies agree to them just to make the government go away. Fines associated with criminal wrongdoing aren’t deductible, but they’re far less common.

    • LV

      When did Socialism become a bad word?

      • Guest

        Never. It has always been so since inception.

    • Great job David!

    • Guest

      Campos is like the nerdy kid you give a dollar to so he goes away.

    • Isn’t Gavin claiming credit, now that he’s made the surprise announcement that he’s running for Presid…….oops, let’s no get ahead of ourselves…….

    • jp

      The final bill was “10’s of million’s” computed by Treasurer Cisneros. He has been working on it for months.

      • Guest

        Yeah, Cisneros should get the credit here, not any politician.

        Things work best when politicians butt out.

    • As a staunch critic of Campos’, I’ll give him a snap up for this signature achievement, of which he has so few. Once taxes are flowing into City coffers, he’ll get another snap from me.

      • Guest

        Now Ed Lee has tens of millions more dollars to burnish his image and screw San Franciscans. Snap, snap!

    • medalist

      how are they responsible for taxes for illegitimate business that was in violation of planning codes? Shouldn’t they be simply fined for operating illegal hotels? That’s what would happen if you were a single owner running your apartment building as a hotel. Oh wait, maybe that’s why they paid the taxes…

      • Sam

        Yes, that always baffled me as well. If something is illegal, like selling drugs or sex, then how can the city reasonably claim that it is taxable? That would mean the city is condoning illegal behavior.

        I think Airbnb paid only because they just happen to be physically located in SF. If they got a demand from Paris, France for 20 million, I can guarantee you Airbnb would have given the frogs a big fat old french finger.

        • Eleen Tigur

          Is this where I get to do my “told you so” victory lap from last year.

          Here it is Sam – exactly how I said it would be and it’s sad to see you saying exactly the opposite of what you said back then.

          You are an ignorant hypocrite.

          Yeah I said it and it’s true. It’s not ad hominem.

          When did you say that? Can you show evidence? Why Yes, yes I can.

          Why here’s a dated search of your ramblings on 48hillsonline regarding Airbnb and taxes from March to September 2014. Thanks Google!

          Should we dig out the choice hypocritical quotes? Or let you just plow through in your comment feculence?

          https://www.google.com/search?q=site%3Ahttp%3A%2F%2F48hillsonline.org%2F+sam+airbnb&es_sm=122&biw=1370&bih=1064&source=lnt&tbs=cdr%3A1%2Ccd_min%3A3%2F1%2F2014%2Ccd_max%3A10%2F31%2F2014&tbm=#tbs=cdr:1%2Ccd_min:3%2F1%2F2014%2Ccd_max:10%2F31%2F2014&q=site:http:%2F%2F48hillsonline.org%2F+sam+airbnb+taxes

          • Guest

            I stand by my statements. Airbnb only paid up because they are HQ’ed in SF. If I ran Airbnb, I’d have moved them offshore and given the city the finger.

            • Spam I Am

              Spam is so funny when he loses. Spam has been telling us over and over – AND OVER – and day after day – AFTER DAY – that Airbnb would NEVER pay these “illegal taxes?”

              The petty landlords who fill this board with their wordy fantasies have lost some major battles in the local landlord-tenant battlefield. Now they’ve lost a battle over fair and progressive taxation. If Spam and his buddies would organize they might win a battle or two, but instead they opt for the coward’s approach from the basement. I suppose they haven’t learned that the ranks of keyboard jockeys are filled mostly with losers.

              And Spam, if you’re a business profiting off real estate somewhere, you’re subject to tax in that location EVEN IF the company is headquartered on Mars (the ultimate corporate headquarters for the libertarian types since earthly governments couldn’t touch them.) Spam should spend more time reading up on the many things he doesn’t know and less time spewing his verbal fantasies here.

    • KH

      Dear Supervisor Campos,

      Thank you for making AirBNB play their taxes. Thank you for advocating for the average, wage earning citizen and for funding the public sphere.

      Please keep fighting for fair taxation on businesses and corporations which use our public assets and do not pay taxes to help maintain them. Our beautiful, dynamic city is a huge resource for businesses and entrepreneurs. We need taxes to help maintain its beauty, its public parks, its schools, its roads, its arts, and its mass transit system. Businesses should want to support our city with their taxes, but sometimes they forget this and we need to remind them that are responsible for its maintenance and upkeep. While we all know it’s puerile not to pay for what you use, we need to remind these adolescent businesses that funding the public sphere is not only a responsibility but good business.

      It is especially important to advocate for the funding of public sphere during this period of income inequality. A strong set of public resources helps to support the well-being, stability, and economic mobility of the majority of citizens who are not in the billionaires club. When there is a huge wealth gap, the general public relies on the public sphere more than ever.

      • Guest

        SF already spends considerably more per capita than any other major US city, and there is pitifully little to show for it. Most of it goes to SEIU members for unaffordable pay and benefits. Not a penny more without true reforms!

        • KH

          What is so bad about paying worker’s benefits. It helps us all if middle and low wage workers have health care and pensions. I do agree that employee contributions do need to be re-thought while maintaining a commitment to the fact that a life-time worth of work deserves fair wages, health care, and retirement benefits.

          • Guest

            KH, I don’t have a problem with you getting a pension through your employment. I do have a problem when I have to pay for my own pension and for yours as well.

            You should pay for yours and I should pay only for mine.

            • Wingnuts are SO full of shit…

            • Steve Shapiro

              I believe calling you a wingnut dies nothing to advance the discussion. I do strongly gud agree with your Libertarian point if view. I get that you feel cheated that someone is getting some benefit that you are not getting and that their benefit is being paid for by OUR taxes.

              Their benefits were and not some benicifient gift from city leaders. They came as a result of an organized voice of hard-working people who within the color of the law engaged in conversation (negotiations) with the custodians of our money at the behest of publicly elected officials. This is the heart of democracy. We each agree and disagree with decisions on policy. We have the ability to communite our feelings directly to these officials and to ultimately change leadership through elections. And, BTW, all the jobs you refer to disparagingly as SEIU are open to applicants from the public, you, me and anyone else who meet publicly vetted criteria.

              I’m assuming you work in the private sector. Unless you are unionized, there is no mandate for your employer to talk to you about any issue concerning wages, hours, benefits or working conditions. S/he is free to deal with you any way she or he wants. Many are not smart enough ( in my opinion) to understand that fairly treated employees tend to be more productive, loyal and long-standing, eliminating the expense of firing, hiring and training new employees.

              But the point is that due to the conversations that have gone on historically between unionized public employees and their bosses, an accord had been reached assuring that people serving us are able to live productive lives, enjoy the fruits of their labor and live a life with dignity after they retire at an age which will allow time to do so.

              This is what we as a society should aspire to for all of us. We ‘re all in this together.

            • Sorry about my typos. A bit distracting. Gotta shringk my thumbs or stop writing on a phone.

    • Russo

      Love it when the new tech barons realize they’re not above the law. See also “Google to adopt Italy regulator privacy demands” here: http://ow.ly/Jq49V