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Officials assure digital lodging sites contribute to Puerto Rico’s economic development

By on October 25, 2018

SAN JUAN – Digital platforms for short-term lodging such as Airbnb contribute to the economic and tourism development through the payment of the 7% lodging fee collected by the Puerto Rico Tourism Co., thus municipalities should not ban them, several government officials said in a House hearing Thursday.

The Municipal Affairs Committee, chaired by Rep. Reinaldo Vargas Rodríguez, is analyzing House Bill 1644, authored by Rep. Eddie Charbonier Chinea, which seeks to prevent that municipalities can limit, prohibit or regulate short-term lodging companies.

Tourism Co. Deputy Executive Director Joseph Feldstein del Valle said that, “since March 2004, the [Tourism Co.] has been the entity responsible for the collection of the room tax. Currently, the Airbnb platform has reported that it has an inventory of 8,300 active properties in Puerto Rico. Between the dates of July 2017 and June 2018, [Tourism Co.] obtained $2.8 million in room taxes from Airbnb.”

He added that other digital reservation platforms that operate on the island such as Home Away and Join a Join, paid $472,000 and $23,000, respectively, and that the Tourism Co. received $2.6 million in room tax from other similar companies.

“In total, the [Tourism Co.] raised approximately $5.9 million in room tax from the short-term lodging model: Vital funds so that the [Tourism Co.] can continue its mandate to promote and develop the tourism industry,” Feldstein del Valle said.

However, Vargas Rodríguez expressed skepticism that municipalities benefit.
“The reality is if it is a business that is generating income and is growing, the municipalities, which provide trash collection services, cleaning and security with municipal police where these businesses are located, it is important they receive some benefit from them. At the moment nothing is written in stone and we are listening to different opinions,” he said.

Meanwhile, minority Popular Democratic Party Rep. Roberto Roberto Rivera Ruiz de Porras said he was against municipalities barring the establishment of these companies in their jurisdictions. However, he believes they should be regulated.

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