Summary:

A popular site that lets city residents rent out their rooms is for the first time proposing to collect a tax in New York City — the news may represent a move towards light regulation of the sharing economy.

Airbnb neighborhoods San Francisco screenshot

Airbnb wants to work with New York City to pass laws that would could make the popular apartment-sharing site more appealing to regulators and other urban residents.

In a blog post published on Thursday, Airbnb said it’s open to an “occupancy tax” and that it will create a 24/7 “Neighbor Hotline” that will help New Yorkers remove “bad actors.”

The post, which is the first time the company has publicly proposed such measures, comes a week after a New York City appeals board reversed a $2,400 fine against a man who used Airbnb to rented his apartment to two Russian tourists.

The ruling was a minor victory for Airbnb but also served to reignite a debate over how to regulate the service. While tech enthusiasts hail Airbnb in paeans to the “sharing economy,” many city residents have grown exasperated with living in buildings overrun by tourists. Meanwhile, big cities like New York and Paris have passed laws to restrict “illegal hotels.”

I can relate to the debate first hand: I’ve rented my place through Airbnb and enjoyed the extra money, and meeting people around the world. On the other hand, I’ve also had to live in a building with jerks who opened a full-blown hotel, and had to endure a revolving door of drunken Australians who lit bonfires in our Brooklyn backyard.

That’s why Airbnb’s apparent olive branch is intriguing: a tax and loose regulatory structure could preserve the benefits of Airbnb while curbing some of the downsides. It’s unclear, however, how the tax would work; would Airbnb simply impose a levy and pass it along to the city? If so, would this do anything to help the people living right beside an Airbnb?

Reached by phone, an Airbnb spokesperson did not elaborate, but said the company is looking forward to working with New York City, and exploring operational details. (The company has also hired a hospitality expert to work with hosts).

Airbnb has also formed part of a larger debate about demands to regulate sharing economy companies, including car-service Uber. Legal scholar Tim Wu notes that calls to protect the public often carry “the odor of industry protectionism” as hotel and taxi lobbies try to keep out new businesses; he also notes, however, that Airbnb might best be regulated at the level of condo or community board and that regulators should use real time information in deciding how to respond to the services.

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