Yes, short-term rentals must pay county’s hotel-motel tax; public information meeting scheduled to clear up confusion

Suffolk County’s 3-percent hotel-motel tax has caused some confusion over who exactly is required to pay it, so officials are holding a public informational meeting at the Hyatt Hotel in Riverhead to clear up any uncertainty.

The Suffolk County comptroller has recently begun cracking down on short-term rentals evading the hotel-motel tax. The short-term rental industry has exploded on the East End in recent years, thanks to online reservation platforms like Airbnb and Homeaway.

But the majority of those rentals have not been paying the 3-percent hotel-motel tax, which is required of any facility that provides overnight lodging for a fee in Suffolk County, according to a report released last December by the comptroller’s office.

“There have been many questions on who has to pay this tax,” said Suffolk County Legislator Al Krupski in a press release yesterday.

The public meeting March 30 is being held to answer those questions. The meeting is free and will take place at 6 p.m. at Riverhead’s Hyatt Hotel on East Main Street.

An audit last summer revealed “widespread non-compliance” with the hotel-motel tax, which led the comptroller to create a tax compliance unit to investigate establishments that haven’t registered with the county to collect the tax or who may be underreporting their taxable sales.

As of December, there were about 350 registered lodging establishments in Suffolk County – mostly hotels, motels and bed & breakfasts – that paid taxes totaling nearly $10 million in 2015.

That revenue exclusively funds tourism promotion in Suffolk County, cultural events and preservation of historic sites, according to the comptroller’s office.

But there are perhaps thousands more short-term rental facilities – including guest houses, cottages and bungalows – that are advertised on online reservation platforms like Airbnb, Homeaway and VRBO in Suffolk County, according to the comptroller’s December report.

“These are businesses that should be collecting and remitting the hotel-motel tax and for the most part, are not,” the report said. “This is the target population of the unit’s efforts.”

Comptroller John Kennedy said that these facilities’ evasion of the tax contributed to traffic problems, over-crowding and “rowdiness” from seasonal tourists last summer on the East End. The hotel-motel law also requires facilities to keep a rental registry so emergency responders will know how many occupants are staying at a property in the case of an emergency. “Lack of compliance with this can cause serious safety issues,” Kennedy wrote in his December report.

Anyone interested in attending the March 30 meeting or looking for additional information can contact John Stype at Krupski’s office at 631-852-3200 or john.stype@suffolkcountyny.gov.