You may have seen an article in the Cape Cod Times over the weekend that says how Cape leaders look to tap rental tax for wastewater projects; The article glosses over an important issue – for the wastewater tax to be effective, it would require an expansion of the rental occupancy tax to start taxing single-family homes. Your REALTOR® organizations, both locally and statewide, steadfastly oppose the expansion of the rental occupancy tax. So, CCIAOR President Greg Murphy has submitted a letter to the editor to the Cape Cod Times to spread the word that homeowners should not be turned into tax collectors. You can read it below:

Homeowners are not tax collectors

In response to Doug Fraser’s article “Cape leaders seek to tap rental tax for waste water projects,” let me present the other side of the equation – the one that protects homeowners.

Underlying the argument to solve our wastewater needs is a proposed new tax that  would turn homeowners into tax collectors through the expansion of the room occupancy tax – something that they are not equipped to do.

For years, hotel owners and operators have been spreading the false narrative that the rental of single-family homes are undercutting their business, and that the new tax would level the playing field. This is categorically false.

The vast majority of single-family homes are rented out for one week or two weeks or even longer. They do not offer daily housekeeping service and are not flipping them nightly like ‘AirBnB’ does. Many of these homes are owned by Cape residents and some even live in them the rest of the year, but seek to make some money to cover the costs of taxes and insurance, or to make some extra money to help put their kids through college or fund home improvements. This new tax would put the burden of collecting on homeowners, somewhere it doesn’t belong.

Hotel owners, on the other hand, are set up and structured as a business and collect the tax as a part of their daily operations. They offer daily housekeeping service, most offer food service and include a wide array of amenities a single-family home can’t match and does not seek too. These are businesses. Most of their stays are a few nights, not one week, two weeks or even a month at a time as many single-family homes are.

As REALTORS®, we know the need to find wastewater solutions and believe this is a priority for the Cape to fix. This is not about that – it’s about masquerading an expansion of a tax into an area it does not need to be. A higher room occupancy tax to fund wastewater is something to be debated, but expanding that same rooms tax to turn homeowners into tax collectors should be taken off the table.

Greg Murphy
Cape Cod & Islands Association of REALTORS®

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