(The Center Square) – Saying short-term rentals have an unfair advantage by allowing them to operate tax-free, a hotel group is calling for changes.
Illinois hotels are required to charge guests a 6% lodging tax, and now an industry group is calling for short-term rentals, like Airbnb and others, to pay the same tax.
Michael Jacobson, the president and CEO of the Illinois Hotel and Lodging Association, said proposed legislation would level the playing field.
“This isn’t about being anti-competition,” Jacobson said. “The hotel industry welcomes competition, but current laws give short-term rentals an unfair advantage since they are not required to pay their fair share in lodging taxes.”
The state lodging tax is expected to raise $305 million this year. Jacobson said taxing short-term rentals would provide more dollars for tourism promotion in Illinois and help shore up the state’s finances.
“Convention and visitors bureaus and tourism promotion are one of the major areas so it will actually be reinvested in tourism promotion, which will then just generate additional revenue for the state moving forward,” Jacobson said.
The legislation would also close the loophole that currently excludes online travel agencies from remitting tax on commissions they receive from hotel reservations booked through their websites.
Jacobson is also calling for legislation that would allow hotels to refuse service to customers who engage in verbally abusive behavior towards hotel employees. He said current law does not allow hotels to take action.
“Our employees are the most important part of our business, and they deserve to feel safe and supported when they come to work,” Jacobson said.