IDEAS home Printed from https://ideas.repec.org/a/sae/toueco/v27y2021i2p365-378.html
   My bibliography  Save this article

Airbnb and taxation: Developing a seasonal tax system

Author

Listed:
  • Sara Dalir

    (111996Sheffield Hallam University Business School, UK)

  • Abror Mahamadaminov

    (35006Sejong University, South Korea)

  • Hossein GT Olya

    (34467Sheffield University Management School, UK)

Abstract

This study applies tax planning theory to develop a seasonal tax strategy as an alternative to a fixed tax rate for shared lodging platforms such as Airbnb, to increase hosts’ revenue and to address seasonality in tourism. The annual revenue of the various types of accommodation is used to calculate a seasonality index by the moving average method, which is incorporated as a corrected coefficient in a seasonal tax formula. The sample includes data from 1258 active Airbnb listings in Boston, Massachusetts. Using a mean comparison test, this study reveals that the application of a seasonal tax strategy significantly increases the revenue of Airbnb hosts compared to a fixed tax rate system. Drawing on the flexibility tenet of tax planning theory, policymakers can use the proposed seasonal tax strategy as an instrument to revisit the taxation system for sharing economy businesses based on changes to the socio-economic, environmental and political conditions. Implications for all stakeholders are discussed.

Suggested Citation

  • Sara Dalir & Abror Mahamadaminov & Hossein GT Olya, 2021. "Airbnb and taxation: Developing a seasonal tax system," Tourism Economics, , vol. 27(2), pages 365-378, March.
    • Handle: RePEc:sae:toueco:v:27:y:2021:i:2:p:365-378
    DOI: 10.1177/1354816620904894
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/1354816620904894
    Download Restriction: no
    File URL: https://libkey.io/10.1177/1354816620904894?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Olya, Hossein G.T. & Alipour, Habib, 2015. "Risk assessment of precipitation and the tourism climate index," Tourism Management, Elsevier, vol. 50(C), pages 73-80.
    2. Cuccia, Tiziana & Rizzo, Ilde, 2011. "Tourism seasonality in cultural destinations: Empirical evidence from Sicily," Tourism Management, Elsevier, vol. 32(3), pages 589-595.
    3. Gurel Cetin & Zaid Alrawadieh & Mithat Zeki Dincer & Fusun Istanbullu Dincer & Dimitri Ioannides, 2017. "Willingness to Pay for Tourist Tax in Destinations: Empirical Evidence from Istanbul," Economies, MDPI, vol. 5(2), pages 1-15, June.
    4. Nahid Malazizi & Habib Alipour & Hossein Olya, 2018. "Risk Perceptions of Airbnb Hosts: Evidence from a Mediterranean Island," Sustainability, MDPI, vol. 10(5), pages 1-23, April.
    5. Daniel Scott & Geoff McBoyle, 2007. "Climate change adaptation in the ski industry," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 12(8), pages 1411-1431, October.
    6. Cellini, Roberto & Rizzo, Giuseppe, 2012. "Private and public incentive to reduce seasonality: A theoretical model," Economics - The Open-Access, Open-Assessment E-Journal (2007-2020), Kiel Institute for the World Economy (IfW Kiel), vol. 6, pages 1-33.
    7. Merkert, Rico & Webber, Tony, 2018. "How to manage seasonality in service industries – The case of price and seat factor management in airlines," Journal of Air Transport Management, Elsevier, vol. 72(C), pages 39-46.
    8. Hui Li & Kannan Srinivasan, 2019. "Competitive Dynamics in the Sharing Economy: An Analysis in the Context of Airbnb and Hotels," Marketing Science, INFORMS, vol. 38(3), pages 365-391, May.
    9. Connell, Joanne & Page, Stephen J. & Meyer, Denny, 2015. "Visitor attractions and events: Responding to seasonality," Tourism Management, Elsevier, vol. 46(C), pages 283-298.
    10. Philipp Schäfer & Nicole Braun, 2016. "Misuse through short-term rentals on the Berlin housing market," International Journal of Housing Markets and Analysis, Emerald Group Publishing Limited, vol. 9(2), pages 287-311, June.
    11. Bilgehan Uzunca & Andrea Borlenghi, 2019. "Regulation strictness and supply in the platform economy: the case of Airbnb and Couchsurfing," Industry and Innovation, Taylor & Francis Journals, vol. 26(8), pages 920-942, September.
    12. Yang, Yang & Zhang, Honglei, 2019. "Spatial-temporal forecasting of tourism demand," Annals of Tourism Research, Elsevier, vol. 75(C), pages 106-119.
    13. Feldstein, Martin, 1976. "On the theory of tax reform," Journal of Public Economics, Elsevier, vol. 6(1-2), pages 77-104.
    14. María Antonia García Sastre & Margarita Alemany Hormaeche & Miguel Trías Villar, 2015. "Are Regional Political Decisions the Key Element in Reducing Seasonal Variation in Tourism? The Case of the Balearic Islands," Tourism Economics, , vol. 21(6), pages 1207-1219, December.
    15. Barrow, Devon K., 2016. "Forecasting intraday call arrivals using the seasonal moving average method," Journal of Business Research, Elsevier, vol. 69(12), pages 6088-6096.
    16. Deery, Margaret & Jago, Leo & Fredline, Liz, 2012. "Rethinking social impacts of tourism research: A new research agenda," Tourism Management, Elsevier, vol. 33(1), pages 64-73.
    17. John Ashworth & Barry Thomas, 1999. "Patterns of seasonality in employment in tourism in the UK," Applied Economics Letters, Taylor & Francis Journals, vol. 6(11), pages 735-739.
    18. Anna Serena Vergori, 2017. "Patterns of seasonality and tourism demand forecasting," Tourism Economics, , vol. 23(5), pages 1011-1027, August.
    19. Ridderstaat, Jorge & Oduber, Marck & Croes, Robertico & Nijkamp, Peter & Martens, Pim, 2014. "Impacts of seasonal patterns of climate on recurrent fluctuations in tourism demand: Evidence from Aruba," Tourism Management, Elsevier, vol. 41(C), pages 245-256.
    20. María García-Hernández & Manuel De la Calle-Vaquero & Claudia Yubero, 2017. "Cultural Heritage and Urban Tourism: Historic City Centres under Pressure," Sustainability, MDPI, vol. 9(8), pages 1-19, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Marius-Ionuț Gordan & Cosmin Alin Popescu & Jenica Călina & Tabita Cornelia Adamov & Camelia Maria Mănescu & Tiberiu Iancu, 2024. "Spatial Analysis of Seasonal and Trend Patterns in Romanian Agritourism Arrivals Using Seasonal-Trend Decomposition Using LOESS," Agriculture, MDPI, vol. 14(2), pages 1-24, January.
    2. Jorge Tello‐Gamarra & Carlai Netto, 2022. "The sharing economy in social media: An institutional analysis in an emerging country," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(4), pages 988-999, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paz Rico & Bernardí Cabrer-Borrás & Francisco Morillas-Jurado, 2021. "Seasonality in Tourism: Do Senior Programs Mitigate It?," Mathematics, MDPI, vol. 9(16), pages 1-27, August.
    2. Duro Moreno, Juan Antonio & Turrión Prats, Judith, 2018. "Tourism seasonality worldwide," Working Papers 2072/351586, Universitat Rovira i Virgili, Department of Economics.
    3. Turrión Prats, Judith & Duro Moreno, Juan Antonio, 2017. "Seasonality Determinants for the Main Markets in Spain," Working Papers 2072/306517, Universitat Rovira i Virgili, Department of Economics.
    4. Fernández-Morales, Antonio & Cisneros-Martínez, José David & McCabe, Scott, 2016. "Seasonal concentration of tourism demand: Decomposition analysis and marketing implications," Tourism Management, Elsevier, vol. 56(C), pages 172-190.
    5. Antonio Fern�ndez-Morales, 2017. "Tourism Mobility In Time And Seasonality In Tourism," RIEDS - Rivista Italiana di Economia, Demografia e Statistica - The Italian Journal of Economic, Demographic and Statistical Studies, SIEDS Societa' Italiana di Economia Demografia e Statistica, vol. 71(2), pages 21-30, April-Jun.
    6. Frédéric Dobruszkes & Jean-Michel Decroly & Pere Suau-Sanchez, 2022. "The monthly rhythms of aviation: A global analysis of passenger air service seasonality," ULB Institutional Repository 2013/341140, ULB -- Universite Libre de Bruxelles.
    7. Laila Shahzad & Ajwa Tahir & Maryam Dogar & Salar Saeed, 2021. "A metric-based assessment of climate and tourism in major cities of Pakistan," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(9), pages 13607-13627, September.
    8. Martínez, José Manuel Guaita & Martín, José María Martín & Rey, María del Sol Ostos, 2020. "An analysis of the changes in the seasonal patterns of tourist behavior during a process of economic recovery," Technological Forecasting and Social Change, Elsevier, vol. 161(C).
    9. Anna Serena Vergori, 2017. "Patterns of seasonality and tourism demand forecasting," Tourism Economics, , vol. 23(5), pages 1011-1027, August.
    10. Asad Mohsin & Jorge Lengler, 2021. "Airbnb Hospitality: Exploring Users and Non-Users’ Perceptions and Intentions," Sustainability, MDPI, vol. 13(19), pages 1-20, September.
    11. Dimitrios Tsiotas & Thomas Krabokoukis & Serafeim Polyzos, 2021. "Detecting Tourism Typologies of Regional Destinations Based on Their Spatio-Temporal and Socioeconomic Performance: A Correlation-Based Complex Network Approach for the Case of Greece," Tourism and Hospitality, MDPI, vol. 2(1), pages 1-27, February.
    12. Dimitrios TSIOTAS & Thomas KRABOKOUKIS & Serafeim POLYZOS, 2020. "Detecting Interregional Patterns In Tourism Seasonality Of Greece: A Principal Components Analysis Approach," Regional Science Inquiry, Hellenic Association of Regional Scientists, vol. 0(2), pages 91-112, June.
    13. Anna Serena Vergori & Serena Arima, 2022. "Transport modes and tourism seasonality in Italy: By air or by road?," Tourism Economics, , vol. 28(3), pages 583-598, May.
    14. Anna Dóra Sæþórsdóttir & C. Michael Hall & Þorkell Stefánsson, 2019. "Senses by Seasons: Tourists’ Perceptions Depending on Seasonality in Popular Nature Destinations in Iceland," Sustainability, MDPI, vol. 11(11), pages 1-18, May.
    15. Turrión Prats, Judith & Duro Moreno, Juan Antonio, 2017. "The Seasonality of Demand in Spanish Tourist Municipalities: Analysis and Determinants," Working Papers 2072/306518, Universitat Rovira i Virgili, Department of Economics.
    16. Nidal Alzboun, 2018. "Measuring Seasonality of Tourism Demand in Petra, Jordan (2006-2017)," Modern Applied Science, Canadian Center of Science and Education, vol. 12(9), pages 131-131, September.
    17. Jorge Ridderstaat & Peter Nijkamp, 2013. "Measuring Pattern, Amplitude and Timing Differences between Monetary and Non-Monetary Seasonal Factors of Tourism - the Case of Aruba," Tinbergen Institute Discussion Papers 13-116/VIII, Tinbergen Institute, revised 05 Sep 2013.
    18. Laura Serrano & Antonio Sianes & Antonio Ariza-Montes, 2020. "Understanding the Implementation of Airbnb in Urban Contexts: Towards a Categorization of European Cities," Land, MDPI, vol. 9(12), pages 1-21, December.
    19. Andrej Agacevic & Ming Xu, 2020. "Chinese Tourists as a Sustainable Boost to Low Seasons in Ex-Yugoslavia Destinations," Sustainability, MDPI, vol. 12(2), pages 1-38, January.
    20. Dehui Christina Geng & John L. Innes & Wanli Wu & Weiwei Wang & Guangyu Wang, 2021. "Seasonal Variation in Visitor Satisfaction and Its Management Implications in Banff National Park," Sustainability, MDPI, vol. 13(4), pages 1-17, February.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:toueco:v:27:y:2021:i:2:p:365-378. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.