- Airbnb is asking Congress to put in place measures that would help the small businesses and entrepreneurs that list accommodations on its site as part of the body’s broader coronavirus relief efforts.
- The company is urging members of Congress to pass a collection of tax relief and loan-related proposals targeted at its property-manager customers.
- Airbnb’s proposals follow its moves last week and this weekend to allow guests around the world to cancel their reservations due to the COVID-19 outbreak.
- Those moves overrode its hosts own cancellation policies, and the cost of them will be largely borne by property managers.
- Visit Business Insider’s homepage for more stories.
Airbnb is asking Congress to help the property managers that list accommodations on its site as part of the body’s effort to stabilise the economy during the coronavirus crisis.
In a letter sent Tuesday to House Speaker Nancy Pelosi and House Minority Leader Kevin McCarthy, the online travel company recommended that the legislature pass a collection of tax relief and loan measures that would specifically benefit its network of hosts. The measures would provide both short-term help for property managers and, longer term, potentially make the short-term rental business more profitable for them.
“We are primarily concerned about the everyday people who depend on travel and tourism for their livelihood,” Chris Lehane, Airbnb’s senior vice president for policy and communications, said in the letter. Airbnb, he continued, welcomes “conversation during your work to ensure any economic relief package includes these or other measures to financially support American short-term rental operators and travel industry solo-entrepreneurs and small businesses during this time of crisis and recovery.”
The letter follows Airbnb’s moves late last week and this past weekend to allow many more of its customers to cancel their bookings due to concerns about and measures to contain the COVID-19 pandemic. Under the latest version of Airbnb’s cancellation policy, guests around the world can now cancel any and all reservations made last Saturday or before for bookings with check-in dates between then and April 14.
Until the change, Airbnb generally allowed property managers to set their own policies, and many had strict terms that discouraged last-minute cancellations. The company’s moves overrode those policies, forcing hosts to sacrifice revenue, often without a chance to recoup it. While Airbnb is refunding the fees it charged hosts on cancelled reservations, it’s not offering to reimburse them for their lost booking revenue, meaning the financial burden of the cancellations will largely be borne by property managers.
In a statement posted on its website on Tuesday, Airbnb’s founders said they made the change to its cancellation policy to promote the health of its guests and the public at large.
“We did not want guests making the decision to put themselves in unsafe situations and creating a public health hazard because of a commitment to their bookings,” Brian Chesky, Joe Gebbia, and Nate Blecharczyk said in the statement. We believe this is the responsible thing to do given the guidance of governments and health experts.
Hosts are upset about the cancellation changes
Its move to override hosts’ cancellation policies during the crisis have upset at least some of them. Victoria Kay has been using Airbnb for four years to rent out a room in her home and a downstairs basement area. The money she gets from the rentals helps her pay the mortgage and utilities on her house; without such income she likely would have been forced to sell the house. She has a strict cancellation policy, because she doesn’t want someone to be able to cancel at the last minute and be left without a chance to find another guest.
Following Airbnb’s change to its policies, she’s had four cancellations, including that of an airline attendant who had booked one of her rooms for 15 nights. She understands why Airbnb made the change, and she’s concerned about the virus herself, but she think the company could have found a better way to handle the situation.
“It’s a huge blow to my budget,” Kay told Business Insider. She continued: “I don’t know if I’m going to be able to afford to pay my bills.”
Airbnb is asking for tax relief and loans for hosts
The proposals Airbnb has made to Congress won’t make hosts like Kay whole, although it may give them some financial help.
The company is pushing for the legislature to allow property managers to get a tax credit for the money they make offering accomodations through its service and its competitors. Alternatively, it urged Congress to allow those hosts to defer the taxes on their short-term rental income.
Airbnb also urged the legislature to make it clear that the property managers that list on its site and others are eligible for the disaster loans that are being made available through the Small Business Administration as a result of coronavirus relief law passed earlier this month.
Additionally, the company encouraged Congress to exempt more short-term rental income from taxes. Under current law, people who rent out a room in their house or other property for 14 or fewer days don’t have to report the income from those transactions to the federal government or pay taxes on it. Airbnb asked Congress to bump that limit up to 60 days.
Finally, the company asked the body to encourage lenders to offer low-interest loans to hosts, using tax cuts or other such incentives.
The letter comes as Congress has been weighing how to stabilise the travel industry and the economy as a whole, after the pandemic has spurred people to abandon their travel plans, forced companies to cancel large conferences, and led to the closure of bars and stores. Airbnb hosts have been particularly hard hit, with bookings dropping by as much as 96% in some places.
Got a tip about Airbnb? Contact Troy Wolverton via email at [email protected], message him on Twitter @troywolv, or send him a secure message through Signal at 415.515.5594. You can also contact Business Insider securely via SecureDrop.
- Read more:
- These numbers show how Airbnb’s business could take a devastating double hit because of coronavirus cancellations
- The coronavirus crisis has exposed a crucial weakness in Airbnb’s business model and it’s likely to haunt the $US31 billion company’s IPO plans
- Airbnb is letting guests around the world cancel their reservations for a full refund and no cancellation fees, as the coronavirus pandemic continues to disrupt travel plans
- How to cancel an Airbnb reservation without a penalty
Business Insider Emails & Alerts
Site highlights each day to your inbox.