State Senate Passes Short-Term Rental Bill
BOSTON — State Sen. Adam G. Hinds, D-Pittsfield, said the state Senate on Wednesday passed S. 2381, An Act regulating and insuring short-term rentals. The bill expands the scope of the state's room occupancy excise tax and local option excise tax to include short-term transient accommodations.
"Short-term rentals have immense impact in the Berkshires and on cities and towns across the commonwealth," said Hinds. "I'm pleased that the Senate bill expands local control over short-term rental services and ensures that these services are competing in a fair and balanced hospitality market."
The legislation would generate an estimated $34.5 million and $25.5 million in state and local revenues, respectively, based on the most recent Senate Ways and Means Fiscal Impact Report. The expanded tax base will automatically apply to all 175-plus cities and towns that have already adopted the local room occupancy excise to date.
The bill contains consumer protection measures, including a requirement that hosting platforms, like Airbnb and VRBO, maintain liability insurance, and strengthens data collection and sharing for cities and towns.
During Wednesday's debate, Hinds led an effort to clarify that timeshares will not be subject to short-term rental taxation. His amendment, co-sponsored by state Sen. Julian Cyr, D-Truro, ensures that in the rare instance when a timeshare licensee rents their timeshare through a short-term rental platform/host site, that they are not subject to additional taxation.
Most timeshare units in Massachusetts are located in the Berkshires and Cape Cod. They are already subject to stringent regulations, like twice-yearly inspections and enhanced safety standards present in a conventional hotel. When a timeshare unit owner uses their property for their normal stay, they do not pay taxes because they are a property owner. When unused timeshare units are rented to non-owners, they are considered hotel rooms and are subject to existing state and local lodging taxes.
In addition, the bill creates a commission to examine ways that hospitality lodging units can be used as a resource to increase availability of emergency shelter for displaced persons.
The bill will now be reconciled with a previous version passed by the House of Representatives.
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