On June 1st 2017, Airbnb Mexico took a huge step forward by making Mexico City the first city in Latin America to abide by tax regulations. It seems that soon, Quintana Roo will become the second state to be regulated. Airbnb Riviera Maya may begin implementing the new regulations as soon as this fall.
Airbnb Mexico Tax Regulations
The hospitality platform has come under fire in recent years due to its lack of regulation when it comes to hotel and tourist taxes. Airbnb itself does not rent out accommodation, private hosts do. Airbnb does aim to inform its users on the legality of earning extra income through their platform. However, the responsibility of declaring and paying income tax falls to the individual hosts, not the company. Local governments and hotel associations have not been happy with the minimal input of Airbnb when it comes to tax loopholes. And, to the company’s credit, Airbnb have done all they can to remedy this.
So far, Airbnb has signed 300 tax collection and remittance agreements globally. These cover areas such as the US, India and some European countries. However, none-so-far had been agreed upon in Latin America. That changed on June 1st of this year, as Mexico City hosts began paying a 3% lodging tax on bookings.
Airbnb Riviera Maya
While Mexico City was the logical first step in solving tax issues in Mexico, it isn’t Airbnb’s most sought-after location. The state of Quintana Roo is, followed by Mexico City, Jalisco and Baja California Sur. Airbnb Mexico currently has around 73,000 listings. However, over 6,000 of them are found in Airbnb Riviera Maya while a further 4,000 are found in Airbnb Cancun. That’s over 10,000 listings in Quintana Roo alone. And state authorities suggest that up to 270,0000 tourists a year travelling to Quintana Roo choose to stay in an Airbnb.
So, if Mexico City was the logical first step, it makes sense that Quintana Roo would follow quickly behind. It was recently announced that Airbnb and the state of Quintana Roo will be signing a tax agreement in the coming weeks. The new regulations should come into effect as of the 1st October 2017. As with previous agreements, Airbnb Riviera Maya hosts will pay 3% lodging tax that will be collected and remitted by the company on their behalf.
The other popular locations in Mexico are expected to sign their own tax agreements in the coming weeks.