Italy judge seizes 780 million euros from Airbnb in tax probe

FILE PHOTO: A woman talks on the phone at the Airbnb office headquarters in the SOMA district of San Francisco

ROME (Reuters) -An Italian judge has ordered the seizure of 779.5 million euros ($836.40 million) from short-term rentals platform Airbnb's European headquarters in Ireland for alleged tax evasion, Milan prosecutors' office said on Monday.

The probe concerns Airbnb's alleged failure to withold 21% of landlords' rental income and pay it to Italian tax authorities, as required by a 2017 law, prosecutors in the northern Italian city said in a statement.

Three people who held managerial roles between 2017 and 2021, the period covering the alleged violation, are under investigation and are jointly targeted by the money seizure order, the statement added.

"Airbnb Ireland has been in active discussions with the Italian tax agency since June 2023 to resolve this matter," a spokesperson for Airbnb told Reuters.

The company was "surprised and disappointed" by the decision and said it acted in full compliance with the law, the spokesperson added.

The company had unsuccessfully challenged the 2017 law cited by prosecutors in a legal battle that ended in December with the EU Court of Justice ruling in the Italian government's favour.

Prime Minister Giorgia Meloni's administration is planning a crackdown on tax cheating on short-term rentals, and wants to raise taxes to 26% from 21% for owners of multiple short-term rental properties.

($1 = 0.9320 euros)

(Reporting by Emilio Parodi and Alvise Armellini, Doyinsola Oladipo in New York, Surbhi Misra in Bengaluru; Editing by Chris Reese, Franklin Paul, Tomasz Janowski and Sandra Maler)