An uncomfortable interview with ABC & Airbnb: Recap

A recent interview on ABC radio between Jon Faine, and Airbnb’s Brent Thomas quickly escalated from a discussion on the introduction of new by-laws to a heated discussion on tax evasion.

When head of public policy at Airbnb ANZ Brent Thomas went on live radio to discuss new by-laws on limiting the use of ‘party-houses’ on the Mornington Peninsula, he didn’t bank on an in-depth discussion about tax.

When initially asked about Airbnb’s stance on paying tax in Australia, Mr Thomas requested the opportunity to finish answering the previous question on regulations. When this was not granted, he continued by telling Mr Faine that Airbnb pays all it is required to pay.

“We’re a private company. Tax is paid on profits and most of our revenue goes back into the company to continue growth,” he said.

When further questioned about what tax Airbnb pays, under what jurisdiction it generates profit and what tax haven it is based in, Mr Thomas continued: “I don’t accept the premise of your question.”

Eventually continuing by revealing that Airbnb’s global headquarters are in San Francisco with a big operation also in Dublin, he reiterated that any necessary tax has been paid.

[pro_ad_display_adzone id=”15046″ align=”left”]Evidently frustrated by his answers, Mr Faine said:

“The bottom line is that companies like yours are predators and parasites basically Brent. You want the benefits of operating in a country like Australia but you don’t make a contribution and you make life hell for your neighbours.”

“We’ve got more than 340 tax agreements with cities and jurisdictions around the world, and unlike traditional accommodation where the revenues go entirely often to international companies, most of our revenues go to Australian people who share their homes and pay tax on that income,” Mr Thomas replied.

Mr Faine finished his sentence, stating that Airbnb “collects a fee and on that fee doesn’t make any contribution back.”

“You operate here and the people who pay the accommodation fees pay the GST, you don’t. You don’t pay company tax and you make money in Australia and you don’t pay anything back.”

In Airbnb’s defence, Mr Thomas concluded with two key points. Firstly, that many major accommodation providers don’t pay their tax at all, and secondly that Airbnb doesn’t ask for hand-outs and therefore doesn’t receive ‘traditional’ benefits.

“You look at the government grants from federal and state governments that go to the traditional accommodation sector and they are hand-outs. They are contributions from tax payers to the traditional accommodation sector and our industry does not benefit from them. One in five people now have an active Airbnb account because consumers and travellers want to embrace the new economy. They want to live like a local, not necessarily in a traditional accommodation area,” he said.

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Peter Hook
Peter Hook
6 years ago

Given that Airbnb have had so many easy interviews in the past where they stick to the line that they are all about sharing (when everyone knows about 60% of all their Australian listings involve no sharing) and try and talk about how they are simply helping Aunt Dorothy fund her hip replacement, an interview like this was about time.

Brent tries to evade answers by saying “look at the hotel industry – they pay no tax”. But that is rubbish. When a hotel employs 200 staff they (and the staff) pay a vast amount in taxes. When they operate function centres and restaurants, they pay massive amounts of tax on products. Hotels pay Federal, State and Local taxes, and their compliance regime is as tough as they come.

Because Airbnb palm off their responsibilities to the property owners, they take the money, but avoid all their corporate responsibilities.

Australian authorities are finally waking up to what cities in the US and Europe have worked out – Airbnb is principally about taking, not sharing.

Julian Maul
Julian Maul
6 years ago

Talk about an irrelevant argument that governments at various levels give grants and that somehow absolves AirBnb from paying any tax in Australia. But are they any better than the likes of Expedia or I’m told by the ATO that it has been agreed that they don’t charge them GST because they would simply claim it back. But one of the reasons we brought in GST was to use it to monitor the amount of income companies make to ensure they are paying the proper amount of company tax. GST paid will ultimately identify how much revenue you have earned. No GST, no revenue, no tax.

I can assure Brent that if I was to do business in the US like AirBnB do in Australia, the IRS would have something to say about it. And i’m sure their argument would be something along the lines of…”Well we give you access to a healthy economy with an infrastructure that you have not had to put a dime towards, you have to make a contribution”.

Ultimately, what will kill AirBnB in Australia will be capital gains tax on whole house lets. All of a sudden, the idea of renting your own home out whilst you are away, won’t be such a great idea.

Andrew North
Andrew North
6 years ago

At the end of the day, no matter how they try to disguise it AirBnB is just another predatory OTA.

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