France and Germany Target US Home-Sharing Platform Giant

Airbnb faces EU clampdown for not paying 'fair share' of tax as France and Germany initiate a new European Union fight to force home-sharing platforms to pay more tax. The French finance minister Bruno Le Maire said Airbnb’s low tax bill was “unacceptable”. In response, Airbnb said that its “model is unique” and that it pays all the tax in the country.

Meeting in Tallinn to Address Sharing Economy

The European Commission informed that a joint proposal from France and Germany would be discussed at a meeting in Tallinn, Estonia, on September 16, during which the Commission will also advise on how best to deal with the so-called sharing economy. The two countries targeted the U.S.-based company Airbnb that paid less than €100,000 in tax in France last year despite having more than 10 million users in the country.

Pierre Moscovici, the EU finance commissioner, said one day earlier that the Airbnb tax figure was “shocking”.

Concerns about Airbnb's Tax Bill

Bruno Le Maire, the French finance minister, said Airbnb’s low tax bill was “unacceptable”. “It is Airbnb’s right to operate in France, but it is also our duty to demand from Airbnb and all digital platforms a fair contribution to the French public treasury,” he said. “These digital platforms make tens of millions of sales and the French treasury gets a few tens of thousands,” Le Maire said. He said Paris and Berlin were working on a joint initiative to squeeze more tax out of “all online platforms, all the online giants”, including Google, Amazon, and Facebook, as well as Airbnb.

Airbnb Respond in a Statement

Airbnb said in a statement that the company is “fundamentally different to other companies that take large sums of money out of the places they do business”. It said that its “model is unique” because most of the money stays in the hands of local people who rent out their homes, rather than going into its own pockets.

The company added that it “boosted the French economy by €6.5 billion last year alone. It empowers regular people, boosts local communities, and is subject to local tax”. It further added that it follows the rules saying: "We pay all the tax we owe in the places we do business. Our France office provides marketing services and pays all applicable taxes, including VAT.”

Sources: EU Observer, The Guardian, Fortune, EurActiv

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