Airbnb rentals produced approximately $61 million in tourism taxes in Massachusetts in 2023, the company said this week.
According to the short-term rental platform, Airbnb rentals around the country produced more than $2.2 billion in 2023, as well as $319 million in Canada.
Massachusetts has a 5.7% room occupancy excise tax rate for rentals of 90 days or less in hotels, motels, bed and breakfasts and lodging houses, according to the state Department of Revenue. In 2019, the state began applying this tax to short-term property rentals of 31 days or less, such as those made through Airbnb.
Cities and towns have the option to charge a local room occupancy excise tax of up to 6%, or 6.5% for Boston, as well as an additional community impact fee of up to 3% on short-term rentals if the operator has more than one property in that community.
Short-term rental operators such as Airbnb have long been criticized for potentially driving up housing prices as investors buy up vacant properties for the sake of renting them out on the platform, rather than leaving them open for someone to live there.
Some cities have attempted to mitigate this effect by limiting what properties can be rented out on the platform, such as Boston, which only allows owner-occupied condominiums and single-, two- and three-family buildings, according to the city’s website.
Short-term rentals are especially prominent in popular vacation areas such as Cape Cod and the Islands.
Last year, Nantucket voters rejected a town meeting article that would have required rentals to be used as a long-term residence for more of the year than as a short-term rental, except for owner-occupied units.
Earlier this month, a judge ruled that Nantucket’s existing zoning by-law does not allow short-term rentals as a principal use of a dwelling in a residential area, according to the Nantucket Current.
The ruling came after a resident sued the town and her neighbors for their use of their property as a short-term rental, as guests in the home had repeatedly created disturbances. The town had refused to do any enforcement to stop the rentals, saying it was a permitted use.
The town was expected to appeal the decision to prevent effects on the upcoming summer tourism season, and an article is before the annual town meeting in May to codify short-term rentals in Nantucket’s zoning by-law, the Current reported.
