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Airbnb deal could boost City of St. Louis' coffers

Many homeowners are using services like Airbnb to make some extra cash, while the option is becoming more popular among travelers
David Kovaluk | St. Louis Public Radio

A global online company will start collecting two taxes in St. Louis next month.

Vacation rental website Airbnb and the city have reached a deal involving the Convention and Sports Tax and the Tourism Tax. The company will automatically collect the taxes and transfer that money to St. Louis officials.

“It’s really a big deal for St. Louis,” said Ben Breit, Airbnb’s Midwest public affairs manager.

“We’re about to see a whole lot of new revenue coming in and I think everyone’s excited about that.”

City officials said the deal will unlock a new source of tax revenue. The Convention and Sports Tax rate is 3.5 percent and the Convention and Tourism Tax is 3.75 percent.

And that money should help in several areas, according to Explore St. Louis President Kathleen Ratcliffe.

“This tax revenue is important to Explore St. Louis for marketing,” she said, in a joint news release.

“And the City of St. Louis for general revenue and bond payments,” Ratcliffe added.

Some of the money will also help with arts-related grants.

The agreement also helps Airbnb hosts in St. Louis avoid dealing with a complicated system, said Breit.

“You're talking about no less than eight different taxes that apply to each and every booking. That's just very difficult for a regular person,” he added. “By and large our host community are just regular, middle-class St. Louis residents.”

A similar deal with the Missouri Department of Revenue went into effect in February. Breit said that has generated more than $2.5 million in revenue for the state so far.

Fees covered in that agreement include:

  • State sales tax, 4.225 percent
  • Tourism tax to maintain quality of water, 0.25 percent
  • Promotional tourism tax, 0.5 percent to 5 percent

Airbnb’s website shows customers who book in St. Charles County also pay a certain tax when they make a reservation, in addition to anything charged by the state.

St. Louis is the company’s biggest market in Missouri. Airbnb reports 88,500 guest bookings last year in the city. The bookings generated a total income for more than $9 million for St. Louis hosts.

Airbnb’s agreement with the City of St. Louis begins Dec. 1.

Follow Wayne Pratt on Twitter: @WayneRadio

Wayne Pratt is the Broadcast Operations Manager and former morning newscaster at St. Louis Public Radio.