We know that there has been some confusion about online travel companies (“OTCs”) such as VRBO and Airbnb collecting and remitting taxes for short term rentals (“STRs”). Recently, the Town learned some OTCs sent correspondence to certain property owners indicating the OTC would collect and remit sales tax due on an STR, but would not collect and remit the lodging tax due on the STR transaction.
In the past, OTCs have rarely collected sales or lodging taxes. However, this past summer, the Town, along with municipalities across the state, adopted uniform language addressing the applicability of sales taxes to online retailers. In adopting such language, the Town was not afforded the opportunity to modify the language out of a need for there to be uniformity across the state.
Unfortunately, OTCs have interpreted this uniform language as only apply to sales tax. As such, OTCs have indicated they will only collect sales, but not lodging, taxes. This has created confusion and inefficiencies for property owners throughout Mountain Village.
As a result, the Town Council has adopted an ordinance requiring OTCs to start collecting and remitting lodging taxes starting with the second quarter of 2021, beginning on 4/1/2021. Property owners should remit lodging taxes for all rentals through the first quarter of 2021 ending March 31, 2021.
These properties will still require a business license with the Town, which will be the responsibility of the owner and will continue to have tax forms for remitting any taxes for sales that may be made not using one of these companies.
If you have questions or concerns, please contact: Julie Vergari.