A key tourism accommodation body has expressed its deep concern over media reports of rorts and errors by short-term accommodation property owners being a “key driver” of a $9 billion income tax shortfall.
Tourism Accommodation Australia (TAA) said the revelations were “deeply concerning” and underscored the importance of the Australian Tax Office (ATO) data matching program.
An article in the Australian Financial Review said some landlords were failing to disclose annual income of more than $70,000 from rental platforms used by an estimated 190,000 individuals renting out homes or apartments, according to ATO analysis.
An earlier article in the same paper said the prospect of six-figure earnings was being used to lure tenants and investors into subletting properties via websites such as Airbnb – without owning any of the homes or, in some cases, the knowledge of the property owners.
Jimmy Thomson, who writes a weekly column Flat Chat about the highs and lows of apartment ownership and strata rules, said the potential profits were very real, adding that research into Airbnb’s online listings has uncovered several “hosts” each with hundreds of properties under their management, with even greater numbers listed on as many as 50 niche websites.
TAA chief executive Michael Johnson said the reports revealed the magnitude of the tax loss that Australians were enduring as a result of a lack of regulation and transparency in sections of the short stay accommodation industry.
“The extent of the ATO’s concerns regarding the scale of the income tax loss is deeply troubling,” Johnson said.
“$9 billion in lost income tax represents hospitals, schools, infrastructure projects and critical services for Australians that could have otherwise been delivered.”
“This is not some benign leakage from the tax system that can be overlooked – this is a significant issue with considerable implications for all Australians.”
“In cases where hosts earning over $70,000 are under-declaring or failing to declare their rental income altogether, this robs Australians in several ways – jobs in the traditional accommodation sector are sacrificed, tax that would have been generated by accommodation hotels is foregone and this cost is borne directly by the Australian people.”
“Lost income tax loss adds to a long list of other well-known problems caused by the unregulated short stay accommodation sector including risks to guest safety, undermining of past and future investment decisions and damage to community amenity.”
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