Here in America, it’s not often that citizens celebrate taxes (hence the whole Declaration of Independence thing). But on the eve of Independence Day, a new tax agreement should give Houston arts groups a reason to make merry.
Houston’s Hotel Occupancy Tax (HOT) will be collected from Airbnb customers, starting July 1. This comes with a new partnership between Houston First Corporation, the local government agency, and the popular online home sharing platform.
How does that benefit Bayou City creatives? More visitors to Houston means more money to these groups. According to a statement, the 7 percent tax on Airbnb rentals will flow to Houston First, which promotes and markets Houston’s travel, tourism, and arts communities around the world and operates the city's convention, arts, and entertainment venues.
Extra good news for Houston arts organizations: As dictated by state law, 19.3 cents of every dollar collected goes to city arts programs. Houston, in fact, boasts the highest percentage in Texas of HOT funding dedicated to the arts.
Houston is now the largest Texas city to reach an agreement with Airbnb for collection of the HOT. The new tax collections by Airbnb are expected to generate $3 million a year locally, according to Houston First estimates.
Airbnb already has partnered with more than 400 local governments throughout the U.S. to collect and remit taxes. The company already collects the Texas State Hotel Occupancy Tax on behalf of all hosts (including in Houston) under an agreement with the Texas Comptroller’s Office.
Airbnb delivered $15.3 million in tax revenue to the state in the first year of the agreement, (nearly doubling the initial expectations), according to a release.
“This is a great day for Houston’s art community, as we count on this revenue to grow our vibrant arts landscape,” said John Abodeely, CEO of the Houston Arts Alliance, in a statement. “We hope other short-term rental platforms will follow Airbnb’s good-citizen example.”