Short Term Rentals – Italian Government proposes new restrictions

Italian government prepares new VAT registration requirement for landlords

Italy’s centre left administration proposes to introduces limitations for those who rent rooms, holiday homes or apartments for short periods 

An amendment to the “Milleproroghe Decree” (one thousand extensions), presented by the “Democratic Party” to the Italian Chamber of Deputies, proposes a squeeze for those who rent tourist houses, or rooms  on sites such as Airbnb and Booking.Com.

The proposal provides that Municipalities must issue a specific license and will be able to set a ceiling on the duration of stays within the year.  In order to rent more than three rooms, even for just a weekend, and in any case for periods of less than eight days, private individuals will have to register for VAT. 

More regulation?

The proposal has already sparked criticism, The move has been attacked on the grounds that  the proposal risks suffocating the sector with more bureaucracy and driving more people into “off-book” transactions.  This is obviously a battle between lobby groups and the proposed measure evidently promoted by hoteliers’ associations.  It is indeed a pity that Italy cannot bring some obviously needed sensible regulation to the whole sector, harmonising the rules across Italy and ensuring a level playing field, in tax terms, by commencing a process of consultation with interested parties and arriving at a consensus.  Instead we see these last minute badly thought out proposals driven by one lobby group, for which landlords, web-portals, councils, regulators and tenants are not prepared, and one which, one fears, are doomed to be subject to challenge in the Courts, including the European Court of Justice, in the same way as the “airbnb tax“.   

The Milleproroghe will arrive next week in the voting committee, while the draft law is expected in the Chamber by 10 February. 

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