In Canada, businesses are exempt from collecting GST/HST if the business makes under $X per year. This feels sensible and reduces paperwork and things to think about when starting up, but is a clear example of how AirBnB was skirting the rules by treating each renter as a business. They should have been collecting GST/HST from the start at the platform level.
A completely personal rant:
I was almost evicted since my landlord wanted to make more money with Airbnb. Before that I've already heard of cases how in tourists towns the local poorer population wasn't able to get long term apartments because richer tourists filled them through Airbnb.
Airbnb is cancer for the local population in any country that isn't very rich because locals & students then have to commute from further distances.
So banning Airbnb would be godsend for the local population of many countries, if you want to make money with renting open a hotel.
Obviously there is the argument "I own the apartment so I can do whatever I want". I really have no good counter argument for this as it is true. But all laws are really relative to the culture. This same person could then say "I don't owe the country any taxes because _I_ made the money".
So this just goes to show that we "normalize" everything based on laws.
For the greater good of the local population in poorer countries Airbnb should be banned.
I can see no mention in article of Airbnb asking for a bailout in Canada and in turn Canada slapping a tax.
The bigger news from this budget update is that Netflix/Prime avoided a 'Cancon tax', where they would be forced to make more Canadian content for the services, funded by an added levy on consumers in the country. We dodged a bullet there, I certainly don't mind these changes.
The audacity of asking for a bailout while planning the IPO.
Canada still has an exemption for small suppliers not to pay sales tax, so this provides a strong incentive for those to find ways to take bookings outside of Airbnb.
Does an owner-operated web site count as a "digital platform"? What about a centralised telephone booking service?
Or does it just mean "anything that's big enough to be targeted as one entity by government"?
It seems clumsy to tax the booking method rather than the supply itself, but maybe it's a matter of practicality for tax collectors.
How did the title of the HN post change? I originally posted "Airbnb asked Canada for a bailout. Canada slapped Airbnb with a tax." It's now "Canada to apply GST/HST to short-term rentals booked online"
I benefited from AirBnB and I am glad this is in place. Now hotels have no excuses but to offer better services or better price.
It's just unbelievable to consider that Amazon, AirBnB etc. have been so successful due to tax irregularities, and of course, when at scale, they G and A can doe this via Dublin loopholes etc..
When bureaucrats are searching for ways to make money, and they always all, for god's sake why don't they go to the obvious places first?
We also have to consider how much our subsidized postal systems are really just subsidizing one form of business over another.
What is this thread, a branch of /r/LateStageCapitalism? People, who are not aware that the questions they raise were answered centuries ago, are philosophastering about their "solutions".
Canada still hasn't put out a budget. Their "Fall economic update" explains why there is no budget. Their deficit is $381 billion. Yet they are talking about socialized childcare?
To be clear, Canada's total debt that built up since the 1980s is ~$750 billion. In 2020 alone the deficit of an equivalent of 20-30 years of government debt.
Who is to pay for all this spending? Well it's simple. We can look to our largest industries. Mining/Oil/Gas is actively being harmed and can't even afford themselves. Manufacturing was destroyed by christia freeland. Government taxes destroyed bombardier which is now being sold off. Little to airbus, little to alstom.
So we know exactly who is left in Canada to pay the bills. FIRE. Finance, Insurance, and Real Estate.
Finance are the ones who get to handle and manage the debt. So let's be realistic, Insurance and real estate left. Oh right, record low interest rates, possibly going negative. Real estate is being propped up by the government trying to prevent explosion.
I guess Insurance will be the one holding the entire debt?
> One reason that short-term rentals have been cheaper than hotels is because hotels had to collect and pay sales tax while Airbnb didn’t.
Seems like this isn’t a new tax from out of nowhere to disadvantage Airbnb but rather a policy designed to bring Airbnb in line with their peers.
It reads like Airbnb was put at an artificial advantage as compared to hotels because hotels had to charge sales tax. Now everyone does. Seems fair to me. What seems unfair is that they weren’t subject to this the whole time. Honestly surprised it’s not retroactive.