EU Court: Airbnb must pay tax based on national tax regime

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Short-term accommodation rental service Airbnb must share information from rental contracts with tax authorities and withhold tax based on national tax regime

Short-term accommodation rental service Airbnb must share information from rental contracts with tax authorities and withhold tax based on national tax regimes, according to a ruling today by the Court of Justice of the European Union.

The ruling comes in response to an appeal by Airbnb against an Italian law that since 2017 has required Airbnb and other short-term rental websites to share information from their rental contracts with tax authorities and to withhold a 21% tax on rental income and report to the tax authorities.

The company challenged the legislation in an Italian court, arguing that the taxation and other obligations contravene the European principle of freedom to provide services in the 27-member bloc.

The Italian court then sought the opinion of the Court of Justice of the European Union.

“Union law does not preclude either the obligation to collect information or the withholding tax imposed by a national tax regime,” the EU Court of Justice said in a statement. “On the contrary, the obligation to appoint a tax representative constitutes a disproportionate restriction on the free provision of services.”

RES-EMP

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