Abstract
Airbnb has been described as a ‘disruptive innovator’, acting as a facilitator to connect individuals, who have additional capacity in a room or a house, with individuals requiring accommodation. Even though the service of providing accommodation is not a new concept, Airbnb has been successful in multiplying these interactions exponentially and is already offering more than 6 000 000 spaces to rent worldwide. This has created multiple new business owners overnight. As a result, tax compliance challenges have arisen in the countries where Airbnb operates insofar as tax liability has been shifted from regulated establishments to thousands of individuals offering accommodation on Airbnb and other similar online accommodation booking platforms. The tax compliance challenge is directly related to the shift of the tax liability to individuals, a group notorious for underreporting, and heightened by the fact that Airbnb does not report any information to tax revenue authorities in relation to host income earned. Due to the amount of these transactions taking place across Airbnb and other online booking websites in South Africa, the South African Revenue Service (SARS) can suffer significant losses to the fiscus if this issue is not adequately addressed. ..
M.Com. (South African and International Taxation)