SECTION 1. The General Laws, as appearing in the 2014 Official Edition, are hereby amended by inserting after chapter 65C, the following chapter:-
Section 1. Definitions
As used in this chapter, the following words shall have the following meanings:
“Lodging Marketplace” means a platform through which an unaffiliated third party offers to rent a vacation rental or short-term rental to an occupant and collects the consideration for the rental from the occupant. For the purposes of this paragraph, “unaffiliated third party” means an entity that is not owned or controlled, directly or indirectly, by the same entity or person.
“Lodging Accommodations” means any space offered to an individual or entity for lodging, including any hotel, motel, inn, tourist home or house, resort, campground, lodging house, rooming house, residential home, apartment, dormitory, public or private club, boat, mobile home or house trailer at a fixed location or other similar structure or space not otherwise required to pay taxes under chapter 64G.
“Lodging Operator” means a person that rents to an occupant any Lodging Accommodation offered through a Lodging Marketplace.
“Lodging Transaction” means a charge to an occupant by a Lodging Operator for the occupancy of any Lodging Accommodation resulting from the use of a Lodging Marketplace.
“Vacation Rental” or “Short-Term Rental” means any individually or collectively owned single-family house or dwelling unit or any unit or group of units in a condominium, cooperative or timeshare, or owner occupied residential home, that is offered for a fee and for less than thirty consecutive days. Vacation Rental and Short-Term Rental do not include a unit that is used for any nonresidential use, including retail, restaurant, banquet space, event center or another similar use.
Section 2. Registration of Lodging Marketplaces
A Lodging Marketplace shall register with department of revenue for the payment of taxes levied by the Commonwealth for taxes due from a Lodging Operator on any Lodging Transaction facilitated through the Lodging Marketplace.
Notwithstanding any other law, a Lodging Operator shall be entitled to an exclusion from any applicable taxes for any Lodging Transaction facilitated by a Lodging Marketplace for which the Lodging Operator has obtained from the Lodging Marketplace written notice that the Lodging Marketplace is registered with department of revenue to collect applicable taxes for all Lodging Transactions facilitated by the Lodging Marketplace, and transaction history documenting tax collected by the Lodging Marketplace.
A Lodging Marketplace that is registered with the department of revenue shall not be required to list or otherwise identify any individual Lodging Operator.
The department of revenue shall develop a uniform application and establish criteria for the approval of said registration with the agency. The department may require a reasonable fee for initial registration and renewal of the same.
Section 3. Imposition of Excise Tax
An excise is hereby imposed upon the transfer of occupancy of any Lodging Accommodations through the business of operating a Lodging Marketplace or, in the case of a Lodging Marketplace that is registered pursuant to this act, on any Lodging Transaction facilitated by the Lodging Marketplace at the rate of five per cent of the total amount of rent for each such occupancy.
The tax may not be collected from a Lodging Operator with respect to any Lodging Transaction or transactions for which the Lodging Operator has received written notice or documentation from a registered Lodging Marketplace that it has or will remit the applicable tax with respect to those transactions to department of revenue pursuant to this act.
Section 4. Distribution of Funds
There shall be a Lodging Marketplace Trust Fund. The commissioner of the department of revenue shall be the trustee of the fund and shall expend money in the fund to address the impact of lodging marketplaces, as defined in section 1 of chapter 65D of the General Laws. There shall be credited to the fund: (i) any excise assessment collected pursuant to section three of this act; and (ii) any interest earned on money in the fund. Amounts credited to the fund shall be expended by the commissioner pursuant to subsection (c) without further appropriation. Money remaining in the fund at the end of a fiscal year shall not revert to the General Fund.
(b) Annually, not later than February 1, each registered Lodging Marketplace shall submit the required excise and a breakdown of the municipalities where such Lodging Accommodations were rented, as a result of a transaction, to the department of revenue. Not later than June 30, the commissioner shall post on the department’s website the aggregate number of vacation or short term rental transactions from the previous calendar year for each city or town.
(c) The department of revenue shall: (i) proportionately distribute fifty percent (50%) of the amount received from the fund to a city or town based on the number short-term or vacation rentals within a city or town from the previous calendar year for the improvement of road and water infrastructure (ii) distribute forty percent (40%) of the amount collected to the Massachusetts Clean Water Trust established in chapter 29C of the General Laws to provide financial assistance in the funding of water infrastructure projects or any other purpose authorized under chapter 29C; and (iii) distribute ten percent (10%) of the amount collected to the department of revenue for administration and enforcement of this act.
(d) Annually, a city or town receiving funds from the Lodging Marketplace Trust Fund shall submit a report to the commissioner of the department of revenue not later than December 31 detailing the projects and the amount used or planned to be used for infrastructure-related projects as described in subsection (c). The commissioner shall compile the reports and post the projects and amounts of money used on the website of the department.
Section 5. Local Option Excise
A municipality may elect to assess and collect a local tax in accordance with Mass. Gen. Laws ch. 64G, §3A on lodging accommodations covered under this act. Said excise collected under this section shall be collected and disbursed in the same manner as identified in Mass. Gen. Laws ch. 64G, §3A.
Section 6. Regulatory Authority
The commissioner of the department of revenue shall adopt regulations to carry out the purposes of this act.
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