Governor Murphy rolls back short-term rental tax for some

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Sunday, August 11, 2019
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Gov. Murphy signed a law giving tax relief to property owners who rent their Jersey shore homes directly.

TRENTON, New Jersey -- Property owners who rent their Jersey shore homes directly are no longer responsible for the so-called Airbnb tax under a new law Gov. Phil Murphy signed Friday.

Murphy signed the bipartisan bill as the summer season heads into its final few weeks and after a push from rental property owners to undo the tax that they said threatened the New Jersey's multi-billion-dollar shore tourism industry.

"Our shore economy adds tremendous vitality and dynamism to New Jersey," Murphy, a Democrat, said in a statement. "Access to affordable rental properties for visitors and income on rentals for homeowners are the backbone of that economy."

The new law means that shore homeowners who manage rentals themselves- through personal referrals, yard signs or newspaper ads, for example - are no longer responsible for a tax of at least 11.625%.

That tax went into effect late last year as part of the budget Murphy and lawmakers enacted, but the tax will still apply to other so-called transient accommodations managed through travel agencies or online marketplaces, like Airbnb or VRBO.

The new law resulted in a sigh of relief among a coalition of rental property owners, including some from New York and Pennsylvania, who said the tax was stifling business.

"By signing this bill into law the Governor is both proving New Jersey is a tourism friendly state and protecting the integrity of the business economy along the shore," President of the NJ Shore Rentals Coalition Denise Payne in a statement.

Just how many people the new tax affected is unclear. Payne said previously that the coalition estimates that it could be as many as 6,000.

New Jersey's tourism website estimates overall the shore saw 100 million visitors in 2017, and they accounted for about $43 billion in spending.

Murphy's administration previously defended the tax as a way to "level the playing field" among hotels, motels and accommodations offered through online marketplaces like Airbnb.

On Friday, the administration said the new law "more closely mirrors the original intent, which was to create parity throughout the rental industry."

Other states collect similar taxes. A 2018 National Conference of State Legislatures' report found 39 states collect some kind of tax on short-term rental accommodations.----------

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