Short-term lodging tax could help school funding
I read with great interest articles almost weekly in your newspaper concerning funding shortfalls in our school district resulting in layoffs, and the need for more affordable housing for our teachers. It appears to me that there will be a need to again, go back to the Summit County voters to approve a tax increase to meet these funding requirements on a permanent basis.
In the past, I have also read articles concerning other county departments that are facing cutbacks in services due to sharp increases in operating costs.
I want to let you know of a potential very large pool of tax revenue that is currently in existence here in the county that is simply not getting collected because the state license law is not being enforced. That tax is the sales tax on short-term lodging revenue that is not being collected on the income generated by individual second homeowners who rent their Summit County properties on “rent by owner” websites.
This would include such websites as VRBO.com. There are many others as well. This tax is for the rental of condominiums and homes of occupancies of less than 30 days.
As you can imagine, a majority of the vacation stays in the county are in non-traditional lodging consisting of condominiums and homes. In my assessment, most of the owners who have properties listed on these websites do not have a sales tax license and are not collecting the required tax.
It is my understanding that this practice is a violation of the license law. I would encourage you to investigate this further as I suspect that the county is losing out on a great deal of tax revenue that could be used to offset these funding shortfalls.
Furthermore, this practice of internet short term rentals is taking place statewide in thousands of units so the economic loss to the state and other counties could be very large.
I have brought this issue to the attention of the County finance director, the County manager, the County commissioners, the Colorado Department of Revenue, and our state representative for our district. Most of these people have agreed with this assessment, but it doesn’t seem like there is much of a priority to pursue it. I can’t imagine why because it should be relatively easy to enforce the law.
Perhaps we will still need to raise taxes to properly fund our schools and other county services, but at the same time, we should first make a concerted effort to collect the taxes that are already in existence.
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