HONOLULU — A judge should compel Airbnb to hand over 10 years of receipts and other documents from its hosts to the state of Hawaii in part because the home-sharing platform acknowledged some hosts aren’t fully complying with state tax laws, says a court filing.
The state attorney general asked a judge to allow the state to subpoena Airbnb to help it find which hosts haven’t paid the state’s equivalent of hotel and sales taxes.
The face-off follows disputes between Airbnb and local governments in other states.
In New York last month, a U.S. judge shelved a city law that would have required home-sharing platforms to reveal hosts’ names and other information. New York City established the law so it could crack down on illegal listings and impose fines.
Hawaii needs the court’s permission to serve the subpoena because its investigation targets a group of taxpayers, not specific individuals. A hearing is scheduled before state Circuit Court Judge James Ashford in Honolulu on Thursday.
The state attorney general said in a court filing Monday that Airbnb acknowledged its hosts haven’t all paid taxes, noting the company proposed legislation that would have allowed it to register as a Hawaii tax collection agent to ensure they do. The attorney general said such legislation wouldn’t be necessary if hosts were tax compliant.
In addition, the filing said, Airbnb testified before lawmakers that it would have generated more than $41 million in new revenue for the state in two years had it been allowed to collect and remit taxes.
Airbnb said in a court filing last week that the subpoena amounted to an unprecedented, “massive intrusion” that violates state and federal law. The company said the request would cover detailed, private data from about 16,000 people. It said the state failed to show why it should be allowed to “invade the privacy rights of Airbnb and its users on this massive scale.”
Hawaii retorted this week that Airbnb hosts have already contractually agreed that the company may disclose their information to government entities. As for the argument that hosts have a constitutional right to keep information regarding their homes private, the attorney general said “the hosts are using their homes as commercial enterprises.”
Regarding the New York case, the attorney general said it different from the Hawaii case because it concerned the legality of a city ordinance instead of a subpoena from a tax authority. The New York law sought to require Airbnb to provide monthly reports indefinitely, unlike Hawaii, the state’s court filing said.
Hawaii has been trying to make sure vacation rental and bed-and-breakfast operators are paying transient accommodation taxes imposed on rooms or homes rented for less than six months. It also wants to collect the general excise tax — a levy similar to a sales tax — from such operators.