An Italian judge has ruled for the seizure of €779.5 million ($835.5 million; £676.8 million) from Airbnb, a major player in short-term rentals, on the grounds of alleged tax evasion.
Prosecutors have asserted that the company did not collect a tax on approximately €3.7 billion in rental income, which landlords in Italy are obligated to pay at a rate of 21%.
Airbnb told the BBC that it was “surprised and disappointed at the action announced by the Italian public prosecutor”.
Christopher Nutly, a spokesperson for Airbnb, stated that the company’s European headquarters had been engaged in discussions with the Italian tax agency to address the issue since June.
Mr Nutly added “We are confident that we have acted in full compliance with the law and intend to exercise our rights with respect to this issue.”
According to a statement from Milan Tribunal prosecutors, three individuals who held managerial positions at Airbnb between 2017 and 2021 are currently under investigation.
In 2022, Airbnb challenged an Italian law that mandated short-term rental providers, including the company, to withhold 21% of rental income from landlords and remit it to tax authorities.
Airbnb argued that Italy’s taxation requirements were in conflict with the European Union’s principle of allowing the free provision of services across the 27-country bloc. However, the European Union’s highest court ultimately ruled in favor of Italy’s requirements.
In recent years, Italian authorities have intensified their scrutiny of the tax practices of major companies like Airbnb, which has been operating in the country since 2008. Reports suggest that Italian prosecutors have initiated tax-related investigations into Netflix and Meta.
Just last month, Italian politicians announced plans to crack down on landlords who do not pay taxes on short-term rentals facilitated by platforms such as Airbnb. The co-ruling Forza Italia party revealed intentions to introduce a national identification code for short-term rentals in the country.
“That code will bring out the revenue of those who rent flats without declaring them,” Forza Italia leader and Deputy Prime Minister Antonio Tajani told reporters.
Politicians estimate that the move could boost Italy’s fiscal revenue by €1bn.