Since February 1st, 2017 anyone renting out their spare room or other property must pay the same taxes as those that are applied to hotels in the region. From that date onwards, the responsibility for hotel tax shifted from the 19 individual municipalities to the region. For the likes of AirBnB, the taxation system surrounding privately managed short stay rooms, apartments and houses used to be quite the grey area, and to be honest, with the new regulations it’s not necessarily become that much clearer.
'Each region of Belgium has different rules about renting rooms under P2P arrangements, for example in Flanders, even private accommodation providers have to have an authorisation and the property has to meet much the same requirements as for domestic rentals.'
Each region of Belgium has different rules about renting rooms under P2P arrangements, for example in Flanders, even private accommodation providers have to have an authorisation, which may only be granted after inspection, and the property has to meet much the same requirements as for domestic rentals e.g. smoke detectors. The Cabinet of the Premier of Brussels, responsible for Tourism, Rudi Vervoort, enforced on the spot checks in the Brussels region late last year to ensure that standards were being met. Further to this, Brussels region hosts are now also required to register with the Brussels Economy and Employment service. In Flanders business operators will be required to register online with the General Tourism Commission, CGT.
What knock-on effect do these new “tourist accommodation” regulations have for the short-stay market in Brussels? We spoke to Joël Vanmellaert, Managing Director of BBF Serviced Apartments to hear what impact these rules have on the industry and how it may affect the consumer.
First of all, the registration procedure is incredibly complicated. AirBnB have already complained that the regulations are too complex. At the beginning of the year an estimated 2,000 of the 7,000 people offering accommodation had registered their status with their municipality. The impact of this is that the supply will likely dwindle. When supply decreases, the only outcome is an increase in price of accommodation – not good for the consumer.
Secondly, when the “landlord” or owner is being asked to pay tax on their earnings, the one who suffers is of course the end-user, who sees an increase in price, despite the fact that a private let rarely offers the same level of quality that professionally managed accommodation does. And although the newly minted ‘summer agreement’ states that working persons can now earn up to €500 per month untaxed, someone with a nice room on offer can quickly surpass that amount, which means they will have to pay these taxes anyway.
Thirdly, and not at regional level but at local municipal level: there are also municipal taxes to be paid on furnished rentals. Any landlord renting out their property as furnished must register this with the municipality and pay tax accordingly. For example, in Sint Gilles the tax on a furnished accommodation is set at €200 per year. Of course, this is ultimately paid for by the tenant.
The regulations enforced that the beginning of the year will come under review after the initial implementation period, however how will the industry deal with the changes in the meantime? Will this see a welcome resurgence in hotel stays as opposed to internet P2P bookings? Only time will tell.