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Italy to seize $835M from Airbnb in tax evasion inquiry
- DrNosferatu 3y agoAirBnB operates - and openly behaves - like a de facto monopoly. When is the EU sticking its head out of the sand?
- 1letterunixname 3y agoVRBO is usually better for UK and Europe for anything over 1 night.
- lopis 3y agoWhat sort of monopoly does AirBnb operate? I rarely see an apartment these days that isn't published on all the accommodation listings.
- prmoustache 3y agoAren't most airbnb's rentals also listed in booking.com and other similar services in addition to direct rental [1]? [1] I have several time successfully managed to get better price by agreeing to cancel the airbnb reservation and pay directly in cash.
- baq 3y agobooking.com has a sizeable share at least anecdotally - everyone I know checks both abnb and booking when looking for a vacation spot and quite a few properties are listed in both.
- distances 3y agoAnecdotally, I do not check Airbnb any more (since a couple of years). Just Booking and Hotels.com. Airbnb was getting expensive and inconvenient.
- seydor 3y agoNot really, it has a lot of competitors (vrbo, booking etc) and most owners list in multiple websites. it's not a competition problem, and tourists do comparison-shop around. The problem is with tax evaders. Many use airbnb as a 'first contact' platform. If there are returning customers, they often take the money 'under the table'.
- DrNosferatu 3y agoSorry, I meant AirBnB / Booking.com duopoly.
- rammer 3y agoHigh time, these web3.0 IT companies pay for the fraud that they have been perpetuating. Waiting for a similar action on Uber too
- deleted 3y ago[deleted]
- FirmwareBurner 3y ago"But what about m'uh innovative and disruptive SV unicorns!? EU bad."
- metaphor 3y agoItalian citizens are quite capable of tax evasion without the aid of Web 3.0 services; it's apparently a "cultural" thing[1]: > The results show that the propensity to evade taxes is greater among households whose heads have low levels of education and income, are elderly and are resident in the South. Over time, the propensity to evade taxes has been growing on average, especially in the North, which has reduced the gap compared with the South, and among young people under 30 years old. The paper also shows a link between the propensity for tax evasion and some indicators of actual evasion, such as the use of cash and the under-reporting behaviour in the Survey of Household Income and Wealth (SHIW) conducted by the Bank of Italy, confirming the association between cultural elements and evasion behaviour. [1] https://doi.org/10.32057/0.QEF.2021.607 https://doi.org/10.32057/0.QEF.2021.607
- pjc50 3y agoThat's why the government wants witholding by AirBnB: much easier to keep track of than millions of individually evading landlords.
- crotchfire 3y ago[dead]
- petre 3y agoIt's common and a cultural thing in all South Eastern and to a lesser extent in Southern Europe. The most South East you go, the higher the tax avoidance.
- deleted 3y ago[deleted]
- jsnell 3y agoThey get to argue their insane "withholding taxes are an illegal barrier to trade" idea all the way to CJEU, lose, continue to refuse to comply, and then have the gall to pretend they're "surprised". Good grief.
- deleted 3y ago[deleted]
- Detrytus 3y agoWell, depending on the actual situation it might or might not be "insane". I mean, why is AirBnB responsible for withholding taxes from people who are not their employees? Or even are individual business owners? When you go to a restaurant for dinner do you withhold their income tax when paying the bill? No, because it's not your tax, not your problem.
- gpderetta 3y ago> why is AirBnB responsible for withholding taxes from people who are not their employees Because apparently the law says so? Rent income is already taxed at a flat rate (at a relatively generous 21%) as opposed of using the marginal tax rate. Also VAT and sale taxes are commonly withheld at payment. In UK it was the rule until a few years ago for banks to withhold tax on interest income.
- rsynnott 3y ago> In UK it was the rule until a few years ago for banks to withhold tax on interest income. Huh, is it not anymore? I thought virtually everywhere did that; I'd expect compliance to be _extremely_ low where it's not done.
- lotsofpulp 3y agoIt is optional in the US. It gets reported to the tax agencies anyway, so the government will easily know if you did or did not pay.
- drumhead 3y ago[flagged]
- inglor_cz 3y agoYou have obviously never been in Italy or possibly just as a tourist with no contact to the locals. Italian state is quite intrusive and very happy to extract some money from you, either in form of taxes or fees/fines. Of course, Italians are also known for being rather creative, so the resulting arms race cannot end with a triumph of the government, but not for a lack of trying.
- bbzealot 3y agoIt's not really an arms race, it's more an inbalance between different categories of citizens. Employees can hardly avoid taxes (as long as they're regular workers), while autonomous workers ("partita IVA") and small companies/entrepreneurs can easily avoid large amounts of taxes. The latter are a huge source of votes especially for rightwing parties in Italy, so it's not uncommon for governments to make it easier to avoid taxes for them. The current rightwing governemnt went as far as calling taxes "state's pizzo" (where "pizzo" is the payment Mafia asks for protection), it raised the limit for usage of cash, and it's discussing measures to forgive debt of tax evaders ("pace fiscale"). So no, it's not an arms race, it's just that it's convenient to let it happen for some political parties.
- inglor_cz 3y agoIn many countries of the EU, government expenditure exceeds 50 per cent of GDP, which seems to be the ceiling that average taxpayers can tolerate while still being able to pay for their own lives. Italy is at 55 per cent. At this stage, you can't really expect people to be happy with the total tax burden.
- bbzealot 3y agoHow is this relevant to my comment? As an Italian I agree that taxes are rather high, but enforcing them only on a subset of citizens while happily allowing another subset to easily avoid them is definitely not the solution. I'd be much happier if the government enforced taxes for everyone, which would then allow it to either improve services or reduce taxes.
- Ekaros 3y agoSeems entirely logical that taxes are paid where consumption happens. That is where the property is located. It is not like the property is shipped to where buyer is...
- lm28469 3y agoLogical for us plebeians but not for the elite. In France they pay something like 200k of tax per year. Which means that in France some individuals pay more tax than the entire french branch of multinational making. It's perfectly legal though, most of the money is processed through airbnb Ireland
- cjrp 3y agoTax is paid on profit, profit happens where Airbnb choose to make it happen. Same old same.
- yladiz 3y ago> Tax is paid on profit In this case, the tax is paid on the revenue that the landlord makes and Airbnb is supposed to withhold it and pay it to the state. Airbnb being profitable or not is irrelevant.
- Ekaros 3y agoIncome tax is example of tax not paid on profit. And Italy has rent on gross revenue of rental properties. Which the payment processing party that is Airbnb should collect and pay.
- danieldisu 3y agoThere are many taxes that are not paid on profit... VAT/sales taxes, property taxes and a big etc ABNB creates externalities to the countries where it operates (increase rent prices), so it would make sense to tax them because of it. And if they don't like the tax, they are free to stop operating in that country ;)
- seydor 3y agoAirbnb already collects (and i presume pays) VAT so it's not like they can pretend they don't know where they are operating.
- expertentipp 3y agoIf you have a real estate in any desirable location in Italy, it immediately starts to ejaculate with money. Airbnb is like viagra on top of it.
- mojo74 3y agoThanks. I can't look at the leaning tower of Pisa now without smirking.
- kwere 3y agorental yields are not that great outside short term rentals and equity appreciation lag inflation even in the "european capital" Milan
- expertentipp 3y agoYeah I meant short rental eligible places in the desirable tourist spots... and palaces in desirable locations, but for these you really need to be a "member of a family".
- 1letterunixname 3y agoBunga bunga: vacation edition PS: I will ask my Italian friend for confirmation that good real estate is both productive and possibly reproductive.
- shoulderfake 3y ago[dead]
- mpweiher 3y agoThe chutzpah of some of these so-called tech companies is just mind boggling. - You need to do this. = Nah. - There's actually a law, you have to do this, like everybody else. = We think the law is unfair, so we're not going to do this. [Court] The law is perfectly fine, go away. = "We are surprised and disappointed ... " Hey I wanted to rob a bank...and despite advice to the contrary, I went ahead and did it, and now I am "surprised and disappointed" by being sentenced to prison.
- gumballindie 3y agoSounds a bit like what OpenAI does in regards to copyright. Looking forward to their AirBNB and hopefully WeWork moment.
- malux85 3y agoNobody goes to prison and you earn interest on all of that money for a year or two, what’s the downside? As long as nobody is held personally accountable these sorts of things will keep happening, we have to be tougher on the execs
- sgu999 3y ago> we have to be tougher on the execs Yes, but what if the exec's cousin's wife is playing golf with the chief of staff of the minister of the economy? Can't be tougher on this one, sorry.
- deleted 3y ago[deleted]
- namaria 3y agoBeing tougher on deviance cannot produce a world without deviance. Any system will be gamed. It will only shift it around. The middle class fantasy of perfect law enforcement is a fruit of our own moral self oppression. Powerful, wealthy people don't live by rules, they live by personal relationships and any fiction to the contrary is mere propaganda.
- tibbydudeza 3y agoIt is the same here when you are in dispute with the tax authorities - you need to pay them what they demand and only then you can dispute it via the appeals process. If you don't they attach property and goods from you - this happens rather very quickly than the actual appeal process.
- thrill 3y agoSo, Italy's version of cops seizing cash at traffic stops is cool with the crowd?