MILAN (Reuters) -Vacation rental platform Airbnb stated on Wednesday it might pay 576 million euros ($621 million) to Italy’s tax authorities to settle excellent revenue tax liabilities for the 2017-2021 tax years.
Airbnb, which has its European headquarters in Eire, didn’t admit any legal responsibility as a part of the settlement, which didn’t embrace 2022 and 2023.
The quantities which will should be paid for these two years could possibly be “materials,” Airbnb stated in a submitting with the regulator.
The settlement issues the tax obligations of householders, or ‘hosts’, in Italy who use Airbnb to lease out their properties. Airbnb retains a portion of those hosts’ revenues and in return assumes their tax liabilities.
Airbnb stated it didn’t intend to recuperate the quantity from its hosts.
Final month, a choose in Italy ordered the seizure of €779.5 million from Airbnb’s Irish headquarters over alleged tax evasion.
The investigation was associated to Airbnb’s alleged failure to withhold 21% of hosts’ rental revenue and pay it to Italy’s tax authorities, as required by a 2017 legislation, Milan’s public prosecutor’s workplace stated.
The quantity of 576 million euros that Airbnb agreed to pay was reached by deducting from the 779.5 million euros in alleged tax evasion some 200 million euros that some hosts had paid independently to the Italian tax authorities, three sources with direct information on the Home. stated.
The sources additionally stated that Milan prosecutors will now ask the choose to launch the 779.5 million euros.
The case for 3 Airbnb executives beneath investigation will probably be dropped, she added.
The choice was largely anticipated and shouldn’t influence earnings as it’s a one-off determination, Richard Clarke, an analyst at Bernstein, instructed Reuters.
“They’re extraordinarily good to the hosts right here and really pay the taxes on their behalf,” he added.
Airbnb had unsuccessfully challenged the 2017 legislation cited by prosecutors in a authorized battle that ended final December when the Courtroom of Justice of the EU dominated in favor of the Italian authorities.
Prime Minister Giorgia Meloni’s authorities has vowed to crack down on tax evasion linked to short-term leases and desires to extend taxes from 21% to 26% for homeowners of a number of short-term rental properties.
Airbnb stated it goals to adjust to new Italian guidelines that make clear how rental platforms should withhold revenue tax for non-professional hosts in Italy.
“We’re getting ready to conform by introducing new instruments that may enable hosts to have their taxes routinely withheld by Airbnb and remitted on to the Italian tax authorities on their behalf,” the corporate stated in a press release.
Airbnb stated it was additionally getting ready to adjust to DAC 7, an EU-wide tax reporting framework for digital platforms.
Shares of Airbnb rose about 1.5% in premarket buying and selling in New York on Wednesday.
($1 = 0.9282 euros)