Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Up to a third of Airbnb's price gap with hotels is due to tax treatment

ft.com

Post reply on HN
Print view View original

51–60 of 127 posts

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#51

Post by wyager »

stephengillie wrote: post #10
wyager wrote: post #6

Earlier quoted context omitted.

"Skirting the law" is loaded language that makes it sound as though they are doing something illegal. They are not. It's true, though; the reason companies like AirBnB and Uber are so vastly superior to the entrenched competition is that they don't have to deal with all the ridiculous and pointless red tape that makes taxis so horrendous and American hotels so insanely expensive. I'm not sure how anyone can recognize…

"Loaded language" makes it sound like these are fully legitimate businesses on the receiving end of undue criticism. But then you point out how these businesses are operating in the same market, but avoiding the market regulation, almost as though they are operating in a quasi-illegal state. Why do you believe the regulation of these markets is particularly onerous? Can you provide some specific examples?

> Why do you believe the regulation of these markets is particularly onerous? Can you provide some specific examples?

Have you ever stayed in a hotel, and have you ever stayed in an AirBnB? For me, in both cases, the answer is "many times", and the overwhelmingly clear conclusion is that AirBnB offers a vastly superior experience to staying in a hotel for a vastly lower cost. If you look at regional hotel regs; it's clear where the difference is going. Resort taxes, occupancy taxes, inspection and certification fees, etc. For all their costs and alleged benefits, they don't actually manage to make the hotel experience any better or safer than staying in an AirBnB.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#52

Post by NSAID »

coding123 wrote: post #16
JohnTHaller wrote: post #14

Earlier quoted context omitted.

Hotel taxes support infrastructure and city services. And things like proper safety and fire regulations in hotels ensure that guests know where fire exits are, that fire extinguishers are available and operational, that smoke detectors are present in the proper locations and functioning, etc. All of those things cost money. AirBnB offers none of those things. It took a string of deadly hotel fires in the 70s to get…

I'm not coming from any experience in this comment, but I'm wondering if AirBNB rentals will ever have such extra regulation since there are no long-hotel hallways, no fire-escapes, elevators, etc... simply because these are already residences - are we to suggest we need normal homes to be safer than they already are? If these places are "unsafe" in this regard, shouldn't it be improved whether or not they are being…

My wife and are getting licensed for foster care, and this week I'm installing several smoke detectors and CO detectors. We're required to have a minimum of one CO and smoke detector per floor, and an additional smoke detector in each bedroom.

Was our house acceptably safe without those? Probably.

Is it going to be better now? Certainly. It's a bit of work installing 7+ devices, but I understand that we've reduced a lot of risk.

Same thing with the fire extinguishers and other safety equipment we'll have to pick up.

Rental units here have somewhat similar requirements, and I think short-term rentals should have similar safety features.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#53

Post by baddox »

tomcam wrote: post #42
baddox wrote: post #34

Earlier quoted context omitted.

Are there any good sources for Uber's unit costs versus prices? I would be surprised if all rides in all markets are subsidized by VC money. I would expect most of the VC money is being spent on expansion (more cities and more drivers) and that Uber service is actually profitable in mature markets. There are several articles claiming that Uber is profitable in the US.

This is the only in-depth treatment I have found. It's damning: http://aswathdamodaran.blogspot.com/2014/06/a-disruptive-cab...

That is from two and a half years ago.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#54

Post by dajohnson89 »

empath75 wrote: post #45
wmeredith wrote: post #20

Earlier quoted context omitted.

Customers love Uber because it's prices are currently subsidized by VC money. Once that goes away, we'll see how competitive they are.

I actually preferred uber when it first launched and it was kind of expensive and you got nicer cars and more professional drivers.

Uber black still provides that option.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#56

Post by EdHominem »

JohnTHaller wrote: post #14
wyager wrote: post #6

Earlier quoted context omitted.

"Skirting the law" is loaded language that makes it sound as though they are doing something illegal. They are not. It's true, though; the reason companies like AirBnB and Uber are so vastly superior to the entrenched competition is that they don't have to deal with all the ridiculous and pointless red tape that makes taxis so horrendous and American hotels so insanely expensive. I'm not sure how anyone can recognize…

Hotel taxes support infrastructure and city services. And things like proper safety and fire regulations in hotels ensure that guests know where fire exits are, that fire extinguishers are available and operational, that smoke detectors are present in the proper locations and functioning, etc. All of those things cost money. AirBnB offers none of those things. It took a string of deadly hotel fires in the 70s to get…

> Hotel taxes support infrastructure and city services.

So restaurants that don't charge the extra foreigner-tax are destroying the city infrastructure? Or are their regular taxes expected to cover it?

Why not with hotels? Why can't they simply be assessed the real cost of supporting their usage?

If there was a cost associated with hosting an out-of-town guest, why is it a percentage of the room rate? Of course, the answer is "because it can be." Takers gotta take.

> Hotel taxes [also support ...] things like proper safety and fire regulations in hotels ensure that guests know where fire exits are, that fire extinguishers are available and operational, that smoke detectors are present in the proper locations and functioning, etc.

No. The room rates support that. The hotel doesn't keep the taxes so none of the taxes go to helping make the hotel safer.

> AirBnB offers none of those things.

Neither do a newspaper's classified ads.

Whose laws should they support? The guests? The hosts? The country the servers are in?

Should the newspaper have a similar burden? If I sell a car should they have to inspect the car first to make sure I'm not trying to pass off a lemon?

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#57

Post by adamsea »

wyager wrote: post #25
digitaltrees wrote: post #17

Earlier quoted context omitted.

Public safety regulations are not pointless red tape. They are created after real tragedy that shows a clear need. In fact, fire regulations in NY first applied to apartments, while hotel owners fought for decades to avoid the regulation require it fire escapes (Read the following for more information http://www.uvm.edu/histpres/HPJ/AndreThesis.pdf ) Even after fire escapes were mandated hundreds of people died in a…

> Public safety regulations are not pointless red tape. This is the typical refrain of people who are trying to pitch pointless red tape; "it's about public safety!" Of course, 90% of regulations in any given industry have nothing to do with "safety" and everything to do with sustaining the bureaucracy that created them. Even those regulations that are nominally intended to increase safety are often counterproductive…

Just want to point out that the parent post cited specific evidence, with links to a fairly reputable source (wikipedia), to support their claims, which your counter-post lacks.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#58

Post by stuckagain »

wyager wrote: post #44
stuckagain wrote: post #30

Earlier quoted context omitted.

Actually no, owner-occupied residential buildings do not have to meet codes, under the liberal belief that it's OK for a person to subject themselves knowingly to certain hazards. However it is not OK for that owner to subject others to those hazards, which is why hotels and rental properties have to meet those codes even as the codes change. Therefore it is a regulatory advantage of AirBNB that unregulated residence…

> Actually no, owner-occupied residential buildings do not have to meet codes, You are just straight up incorrect. No two ways about it. I'm actually a little surprised someone could have this little exposure to the residential regulatory bureaucracy. Maybe that's why you can support it. Here are some (not all) of the residential building codes that apply here. https://www.tdhca.state.tx.us/single-family/training/doc…

Those are the codes for building a new building. The codes change but the buildings don't have to. You can occupy a 100-year-old building in San Antonio if you feel like doing it. No regulatory bureaucracy will be concerned.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#59

Post by DanBC »

jdavis703 wrote: post #22

Hotels are heavily taxed because tourists and business travellers can't vote. In many cases cities like London and NYC are non-fungible goods, so if you want to go there you just have to pay the taxes. If they ever get high enough that hotels can't book rooms, the businesses should lobby the government to lower them.

London hotels don't pay extra taxes. The taxes that have been proposed - £1 per night - seem modest.

http://www.telegraph.co.uk/travel/destinations/europe/united...

https://www.theguardian.com/uk-news/2015/jan/07/london-touri...

This is, as the local authority says, partly to clean and police and etc areas that are very popular with tourists.

Re: Up to a third of Airbnb's price gap with hotels is due to tax treatment

#60

Post by wyager »

JohnTHaller wrote: post #14
wyager wrote: post #6

Earlier quoted context omitted.

"Skirting the law" is loaded language that makes it sound as though they are doing something illegal. They are not. It's true, though; the reason companies like AirBnB and Uber are so vastly superior to the entrenched competition is that they don't have to deal with all the ridiculous and pointless red tape that makes taxis so horrendous and American hotels so insanely expensive. I'm not sure how anyone can recognize…

Hotel taxes support infrastructure and city services. And things like proper safety and fire regulations in hotels ensure that guests know where fire exits are, that fire extinguishers are available and operational, that smoke detectors are present in the proper locations and functioning, etc. All of those things cost money. AirBnB offers none of those things. It took a string of deadly hotel fires in the 70s to get…

> Hotel taxes support infrastructure and city services.

As a tourist, there's no reason I should have to provide an inordinate level of support to the regional regulators. I'm happy to pay sales tax like everyone else, and the costs of property and utility taxes are already built into the cost of my stay.

> And things like proper safety and fire regulations

Residences already have to obey regional safety and fire code.

> All of those things cost money.

That's true, but you're already paying for that in an AirBnB, because as I said, it also has to follow regional fire code.

You seem to be under the false but unfortunately common impression that all, or even the majority, of regulations have anything to do with improving consumer safety.

> It took a string of deadly hotel fires in the 70s to get regulation up to speed.

The false premise here is that residential building code is not already "up to speed".

Post reply on HN