Italy Is Seizing Over $800 Million from Airbnb for Alleged Tax Evasion

Italy probably won’t be giving Airbnb a five-star review.

An Italian judge has ordered the seizure of €779 million ($836 million) from the online homestay platform for alleged tax evasion, as reported by CNN.

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In a statement made on Monday, a Milan-based public prosecutor’s office said Airbnb failed to collect a tax from landlords on roughly €3.7 billion ($3.96 billion) of rental income amassed between 2017 and 2021.

Italy introduced a law in 2017 that states landlords in the country are required to pay a 21 percent tax on their earnings. Airbnb challenged the law in a European Union court last December, arguing it went against the EU’s principle of freedom to provide services across the 27-country bloc. The court later ruled that Airbnb should abide by the requirements, but it allegedly failed to pay back the taxes.

Prosecutor Marcello Viola told Italian reporters that three of Airbnb’s administrators in Italy also face unpaid tax charges. It is unclear if specific landlords will be charged in any way.

“Airbnb Ireland has been in active discussions with the Italian tax agency since June 2023 to resolve this matter,” an Airbnb spokesperson told CNN on Tuesday. “We are surprised and disappointed at the action announced by the Italian public prosecutor. We are confident that we have acted in full compliance with the law and intend to exercise our rights with respect to this issue.”

Carrying out the ruling won’t be easy—Airbnb can still appeal, in fact—but Italy has won against similar major companies in the past. Google agreed to pay Italian authorities €306 million ($327 million) to cover unpaid taxes for the years 2009 to 2015, while Apple forked out €318 million ($340 million) in a similar deal.

The EU’s laws on vacation rentals have been getting stricter on the whole. Last week, Italy’s Foreign Minister Antonio Tajani told reporters that new rental codes will soon be introduced to clamp down on people who don’t declare profits on their short-term rentals. The move aims to boost the country’s fiscal revenue by $1.1 billion a year.

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