More legal problems for Airbnb
Airbnb this week closed a deal for $450 million in funding, attaining a valuation it’d reportedly been chasing: $10 billion. It’s now, after this funding round led by private-equity firm TPG, one of the most valuable startups on the planet.
But, in the same week, New York State attorney general Eric Schneiderman filed an affidavit with the state Supreme Court in Albany claiming that the majority of Airbnb listings in New York are illegal.
The issue at hand is that subletting for less than 30 days is in general illegal for renters in New York who are not continually residing in their apartment. And, for Airbnb, plenty of the nearly 20,000 offerings – 64 per cent – listed on Airbnb in New York were for an “entire apartment” not a shared space, as the law would seem to mandate.
The company also announced last week that it would begin a pilot program in San Francisco, Portland and New York, to start “self-tax collecting.” The company estimates the tax could collect up to $20 million a year for the government. However, it now seems hoteliers in New York believe that Airbnb facing up to its tax requirements will only “legitimise” it as a hotel brand.
