States struggle in taxing the sharing economy

Although millions of Americans are using “sharing economy” services such as Uber and Airbnb, states are struggling to apply existing tax laws to these technologies.

Only eight states require companies such as Uber to collect sales tax, while a number of states consider this to be a nontaxable transportation service, according to Bloomberg BNA’s 2017 Survey of State Tax Departments. Moreover, 25 states said that the owner of property listed for short-term accommodations on a third-party site such as Airbnb is responsible for collecting the sales tax, while 15 states said that the third party was responsible. A number of states hold both the owner and the third party responsible for collecting the tax.

 

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