Bill > H5476

This bill removes the existing exemption from the state hotel tax for houses, condominiums, or other residential dwellings that are rented in their entirety. Currently, such properties are exempt from the 5% hotel tax, but under this proposed legislation, they will now be subject to the same tax rate as other lodging accommodations. The bill specifically amends section 44-18-36.1 of the General Laws, which governs hotel taxes in the state. By eliminating this exemption, the state aims to standardize tax collection on all types of short-term rentals, potentially increasing tax revenue from properties like vacation homes, Airbnb rentals, and other fully rented residences. The change will take effect on January 1, 2026, giving property owners and rental platforms time to adjust to the new tax requirement. The hotel tax will continue to be administered and collected by the state's division of taxation, and the additional revenue will be distributed according to existing regulations.

Budget and Finance

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