AirB&B Regulation in the DR

What do you a think should happen to AirB&B's in the Dominican Republic?

  • I hope AirB&B is eliminated as they did in NYC.

  • I hope they put in effect strong regulations on AirB&B.

  • I hope they put in effect some regulations on AirB&B.

  • I hope they leave AirB&B with no regulation.


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windeguy

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Jul 10, 2004
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I think the process will be: 1) All AirBnB's need to have a licence. This will be heavily policed, they will have people scouring all the relevant booking channels and a way of reporting anyone who is not licensed - which will work well as those who have gone through the pain will grass up those who haven't. 2) Once you have a licence, DGII will be in contact to make sure you are declaring your income. Obviously there will be people who don't declare all of it, but they will probably make an example of a few owners and get lots of publicity from it.

The DGII doesn't collect taxes directly for hotels which are booked on Booking .com and I can't see why they will want to start with AirBnB.
I disagree on some of the above.

The main thing that will likely happen is AIRBNB will be forced to collect the 18% ITIBIS and pay that directly to DGII for all rentals in the DR.
That already seems clear to me on how collecting taxes will be done. That will be on top of the fees that the renter and owner pay already to Airbnb.
Quite a significant price increase if owners don't drop their pants on their current pricing.

The so called alleged enforcement of the various AIRBNBs being up to standard , having insurance,, registration and/or licenses for All Airbnbs will be a fiasco just like any other government regulations and be subject to the same corruptions and laughable schemes. Airbnb's run the gamut from being able to set up a tent, to bedrooms in a house, apartments, entire homes and more. What standards for all of those, pray tell?
 

CristoRey

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Apr 1, 2014
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Apples and oranges. Mangos and bananas... Illegals versus the laws. Laws versus regulations not based in laws at all.

With respect to Airbnb's many people will find work arounds to the direct 18% tax, etc, by dealing direct. It will take some effort.

They could make a deal with clients to rent with Airbnb for one night and then pay directly to the owner for the rest of a stay.
Don't think that doesn't already happen just to avoid Aribnb's fees. Add another 18% of motivation on top of that.
If it further helps to eliminate unfair competition in the market, we need tougher rules and more regulations.

Trust me, lol.. I get it, some of us don't like it when people find work arounds but I guess since both you and I choose to call the DR home, we're just going to have to accept things for what they really are, not what we want them to be, now aren't we?
 
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Kricke87

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I think the process will be: 1) All AirBnB's need to have a licence. This will be heavily policed, they will have people scouring all the relevant booking channels and a way of reporting anyone who is not licensed - which will work well as those who have gone through the pain will grass up those who haven't. 2) Once you have a licence, DGII will be in contact to make sure you are declaring your income. Obviously there will be people who don't declare all of it, but they will probably make an example of a few owners and get lots of publicity from it.

The DGII doesn't collect taxes directly for hotels which are booked on Booking .com and I can't see why they will want to start with AirBnB.
Completely disagree, from a technical standpoint the most likely scenario if the goverment is actually going to require a license is that AirBNB is going to have to add some sort of check so that only those who have a valid "license" are able to rent out their homes, such as you need to upload a valid license document that shows that you are licensed to run a Airbnb.
Nobody, or at least very few Airbnb owners will be "policing" others to follow the rules. I don't know if you haven't noticed in general Dominicans aren't really that fond on policing others, in other case, how do you explain that when the noisy neighbor is playing his music at 1 AM nobody calls the police but instead decides to "suffer" through it?
Anyway, as Windy has also already explained, if Airbnb then requires you to upload a valid license document for you to create an account to rent out your home, for the majority of Airbnb owners, that will not be an interesting option anymore.
Instead they will go through other channels to rent out their apartment, which in turn might for some be a reason why they stop renting it out for 1-2 days at a time but instead try to get people to live there more permanently and then lower their rates.

Anyways, as with so many other "supposed" changes, it won't work, there's always going to be a loophole that people will go through and there's not going to be enough incentive to actually make everyone "follow the rules".

It just makes me think about a funny situation in Sweden. Because the goverment is so scared of a potential russian invasion, they have tasked one government authority to review and propose improvements on the 65000 bombshelters that has been there since WW2.
However, because there's not been a threat of war or anything like that nearby for the past 30-40 years, they have not been maintained.
Then, that authority put 2 people to do that work. So if they reviewed 2 bombshelters each day during 365 days a year, it would take 89 years to do that........

My point is, nobody is seriously going to go through all the apartments/houses and check if they are being used as short term rentals and if they then follows the rules...
I'm not against it, I'm just saying it's very unlikely, if they cannot make people riding a motorcycle wear a helment, how are they going to manage this?
 

windeguy

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Jul 10, 2004
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I think the process will be: 1) All AirBnB's need to have a licence. This will be heavily policed, they will have people scouring all the relevant booking channels and a way of reporting anyone who is not licensed - which will work well as those who have gone through the pain will grass up those who haven't. 2) Once you have a licence, DGII will be in contact to make sure you are declaring your income. Obviously there will be people who don't declare all of it, but they will probably make an example of a few owners and get lots of publicity from it.

The DGII doesn't collect taxes directly for hotels which are booked on Booking .com and I can't see why they will want to start with AirBnB.
Where was it proposed that Airbnb's will need to have a license?
 

windeguy

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Jul 10, 2004
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If it further helps to eliminate unfair competition in the market, we need tougher rules and more regulations.

Trust me, lol.. I get it, some of us don't like it when people find work arounds but I guess since both you and I choose to call the DR home, we're just going to have to accept things for what they really are, not what we want them to be, now aren't we?
I think it will turn people to other sources to rent short term. Dominicans are VERY good a work arounds. Among the best in the world.

I have learned that living here, if nothing else. Don't you agree?
 

CristoRey

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Apr 1, 2014
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I think it will turn people to other sources to rent short term. Dominicans are VERY good a work arounds. Among the best in the world.

I have learned that living here, if nothing else. Don't you agree?
I do agree with ya but at the same time I've enjoyed twisting your arm just enough to get a continuous response 😅
Have a good one..
 

MariaRubia

Well-known member
Jun 25, 2019
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I disagree on some of the above.

The main thing that will likely happen is AIRBNB will be forced to collect the 18% ITIBIS and pay that directly to DGII for all rentals in the DR.
That already seems clear to me on how collecting taxes will be done. That will be on top of the fees that the renter and owner pay already to Airbnb.
Quite a significant price increase if owners don't drop their pants on their current pricing.

The so called alleged enforcement of the various AIRBNBs being up to standard , having insurance,, registration and/or licenses for All Airbnbs will be a fiasco just like any other government regulations and be subject to the same corruptions and laughable schemes. Airbnb's run the gamut from being able to set up a tent, to bedrooms in a house, apartments, entire homes and more. What standards for all of those, pray tell?

No, that's not correct. Hotel licensing is very slick and the new portal that MITUR has developed is one of the few bits of IT in DR that seems first-world. And anyone operating a hotel without a license is nagged and nagged, first in a nice way but increasingly in a threatening way, to get a license. As I have said many many times now, the same portal starts by asking if you want to register a hotel, or a vacation rental tipo AirBnB. So clearly the idea will be to have these places licensed.

Knowing how AirBnB and DGII work, I just can't quite see that AirBnB will collect the tax. Booking.com certainly won't, and don't pretend that anyone in the hotel trade in DR doesn't know about Booking.com. So there will have to be a mechanism for the apartment owners to pay DGII directly.
 
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RDKNIGHT

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Mar 13, 2017
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well for my two cents if the hotels didnt gouge they're consumers there would be no reason for the consumers to use Airbnb but since they try to squeeze every penny out of them before they leave the hotel and also charge them for guests that come to their room at night this is why common folks use Airbnb
 
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windeguy

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Jul 10, 2004
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No, that's not correct. Hotel licensing is very slick and the new portal that MITUR has developed is one of the few bits of IT in DR that seems first-world. And anyone operating a hotel without a license is nagged and nagged, first in a nice way but increasingly in a threatening way, to get a license. As I have said many many times now, the same portal starts by asking if you want to register a hotel, or a vacation rental tipo AirBnB. So clearly the idea will be to have these places licensed.

Knowing how AirBnB and DGII work, I just can't quite see that AirBnB will collect the tax. Booking.com certainly won't, and don't pretend that anyone in the hotel trade in DR doesn't know about Booking.com. So there will have to be a mechanism for the apartment owners to pay DGII directly.

The information on Airbnb I have seen is that they will collect the tax. That is why they are having an "agreement" with Airbnb.

Booking.com might a good alternative for current Airbnb since they will not collect it. Or Homwayw or the soon to be new site:

BookintheDRsecretlyWithNoTax.com

And how exactly will they license and inspect my Airbnb camp site?
(if I had one)..
 

MariaRubia

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Jun 25, 2019
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well for my two cents if the hotels didnt gouge they're consumers there would be no reason for the consumers to use Airbnb but since they try to squeeze every penny out of them before they leave the hotel and also charge them for guests that come to their room at night this is why common folks use Airbnb

Right, let's just do the math shall we. You pay a hotel US$ 100 for a night. The hotel has to pay US$ 14.06 of that on ITBIS and US$ 10 on Propina Legal. The hotel typically pays the travel agency a commission of 23% of the ex-tax amount, which comes to US$ 17.46. And the hotel pays a credit card processing company typically 5% of the total amount, so that's another US$ 5. So just about half of the US$ 100 you pay has immediately gone, the hotel doesn't see any of this. And with the US$ 53 left, they have to provide two people with breakfast - and I don't know if you've noticed how expensive food is in supermarkets these days. Let's say it costs them US$ 6 for the food cost per person, including the coffee, juice, eggs, bacon, bread, fruit. So now we're down to US$ 41.

And with that the hotel has to a) pay for the air-conditioning which the guests usually run 24/7, b) pay for round-the-clock staffing, normally bilingual staff who cost more, c) pay for the laundry and cleaning costs, d) pay for maintenance, e) pay for insurance and security cameras and everything else they need to do to comply with the law and somehow make a little profit as well.

And now let's compare with an AirBnb that someone who is here on a tourist card has bought, so they are illegally running a business (yes it is illegal to work here or run a business here unless you have residency). Usually they have zero insurance, pay zero tax, (but quite often add the agency commission to the guest and pretends it's a tax), don't comply with any regulations, quite often don't even speak any Spanish. And yes they charge US$ 70 but they stick the whole amount in their pocket. But they do let you bring a puta in, in fact they let 30 kids have a party every night and p'ss off every one of their neighbours and ruin life in condos. And you think they're the good guys?
 

AlterEgo

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Jan 9, 2009
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Right, let's just do the math shall we. You pay a hotel US$ 100 for a night. The hotel has to pay US$ 14.06 of that on ITBIS and US$ 10 on Propina Legal. The hotel typically pays the travel agency a commission of 23% of the ex-tax amount, which comes to US$ 17.46. And the hotel pays a credit card processing company typically 5% of the total amount, so that's another US$ 5. So just about half of the US$ 100 you pay has immediately gone, the hotel doesn't see any of this. And with the US$ 53 left, they have to provide two people with breakfast - and I don't know if you've noticed how expensive food is in supermarkets these days. Let's say it costs them US$ 6 for the food cost per person, including the coffee, juice, eggs, bacon, bread, fruit. So now we're down to US$ 41.

And with that the hotel has to a) pay for the air-conditioning which the guests usually run 24/7, b) pay for round-the-clock staffing, normally bilingual staff who cost more, c) pay for the laundry and cleaning costs, d) pay for maintenance, e) pay for insurance and security cameras and everything else they need to do to comply with the law and somehow make a little profit as well.

And now let's compare with an AirBnb that someone who is here on a tourist card has bought, so they are illegally running a business (yes it is illegal to work here or run a business here unless you have residency). Usually they have zero insurance, pay zero tax, (but quite often add the agency commission to the guest and pretends it's a tax), don't comply with any regulations, quite often don't even speak any Spanish. And yes they charge US$ 70 but they stick the whole amount in their pocket. But they do let you bring a puta in, in fact they let 30 kids have a party every night and p'ss off every one of their neighbours and ruin life in condos. And you think they're the good guys?

Don’t some of the smaller hotels in DR also use Airbnb? How does that work? We stayed at a boutique hotel in Zona Colonial awhile ago, and were chatting with a couple at the next table at breakfast. I think they were from from Seattle, which surprised me. I asked them how they found this small delightful hotel and they said Airbnb. That really surprised me!
 

RDKNIGHT

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Mar 13, 2017
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Right, let's just do the math shall we. You pay a hotel US$ 100 for a night. The hotel has to pay US$ 14.06 of that on ITBIS and US$ 10 on Propina Legal. The hotel typically pays the travel agency a commission of 23% of the ex-tax amount, which comes to US$ 17.46. And the hotel pays a credit card processing company typically 5% of the total amount, so that's another US$ 5. So just about half of the US$ 100 you pay has immediately gone, the hotel doesn't see any of this. And with the US$ 53 left, they have to provide two people with breakfast - and I don't know if you've noticed how expensive food is in supermarkets these days. Let's say it costs them US$ 6 for the food cost per person, including the coffee, juice, eggs, bacon, bread, fruit. So now we're down to US$ 41.

And with that the hotel has to a) pay for the air-conditioning which the guests usually run 24/7, b) pay for round-the-clock staffing, normally bilingual staff who cost more, c) pay for the laundry and cleaning costs, d) pay for maintenance, e) pay for insurance and security cameras and everything else they need to do to comply with the law and somehow make a little profit as well.

And now let's compare with an AirBnb that someone who is here on a tourist card has bought, so they are illegally running a business (yes it is illegal to work here or run a business here unless you have residency). Usually they have zero insurance, pay zero tax, (but quite often add the agency commission to the guest and pretends it's a tax), don't comply with any regulations, quite often don't even speak any Spanish. And yes they charge US$ 70 but they stick the whole amount in their pocket. But they do let you bring a puta in, in fact they let 30 kids have a party every night and p'ss off every one of their neighbours and ruin life in condos. And you think they're the good guys?
I understand what you're trying to tell me but usually if the room costs you $100 is tax added on also the tip and don't forget when you eat in a hotel and everything else it's at least double if not three times the price of eating outside .also don't forget the hotel has over a thousand rooms I'm sure you could ask the Hilton family if Hilton hotel is a profitable business...
 
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windeguy

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Don’t some of the smaller hotels in DR also use Airbnb? How does that work? We stayed at a boutique hotel in Zona Colonial awhile ago, and were chatting with a couple at the next table at breakfast. I think they were from from Seattle, which surprised me. I asked them how they found this small delightful hotel and they said Airbnb. That really surprised me!
Any space from a tent to a full AI resort, Trump Tower or private island, can be listed by the owner or their representative and rented via AIRBNB.
So yes, Hotel rooms certainly included.

Rooms in hotels rented via AIRBNB would fall into the proposed potential agreement the DR government might eventually some day could have with AIRBNB.

Just so there is no confusion in the future.
 

windeguy

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Jul 10, 2004
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Right, let's just do the math shall we. You pay a hotel US$ 100 for a night. The hotel has to pay US$ 14.06 of that on ITBIS and US$ 10 on Propina Legal. The hotel typically pays the travel agency a commission of 23% of the ex-tax amount, which comes to US$ 17.46. And the hotel pays a credit card processing company typically 5% of the total amount, so that's another US$ 5. So just about half of the US$ 100 you pay has immediately gone, the hotel doesn't see any of this. And with the US$ 53 left, they have to provide two people with breakfast - and I don't know if you've noticed how expensive food is in supermarkets these days. Let's say it costs them US$ 6 for the food cost per person, including the coffee, juice, eggs, bacon, bread, fruit. So now we're down to US$ 41.

And with that the hotel has to a) pay for the air-conditioning which the guests usually run 24/7, b) pay for round-the-clock staffing, normally bilingual staff who cost more, c) pay for the laundry and cleaning costs, d) pay for maintenance, e) pay for insurance and security cameras and everything else they need to do to comply with the law and somehow make a little profit as well.

And now let's compare with an AirBnb that someone who is here on a tourist card has bought, so they are illegally running a business (yes it is illegal to work here or run a business here unless you have residency). Usually they have zero insurance, pay zero tax, (but quite often add the agency commission to the guest and pretends it's a tax), don't comply with any regulations, quite often don't even speak any Spanish. And yes they charge US$ 70 but they stick the whole amount in their pocket. But they do let you bring a puta in, in fact they let 30 kids have a party every night and p'ss off every one of their neighbours and ruin life in condos. And you think they're the good guys?
OK, I understand you are using a total cost per day of $100 that the DGII has been told is the cost of the room including all taxes and fees and potential hotel expenses. Makes me glad I never had a hotel, but it brings up a huge question.

How does DGII verify that is the REAL price of the room and not some reduced number by the hotel if that room is booked using an Internet booking system and all the money goes into financial accounts not in the DR?
 

MariaRubia

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Jun 25, 2019
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OK, I understand you are using a total cost per day of $100 that the DGII has been told is the cost of the room including all taxes and fees and potential hotel expenses. Makes me glad I never had a hotel, but it brings up a huge question.

How does DGII verify that is the REAL price of the room and not some reduced number by the hotel if that room is booked using an Internet booking system and all the money goes into financial accounts not in the DR?

You're talking about what the massive hotels do, and in reality they are not the ones competing with AirBnB as most of their clients come on a package which includes the flight and the room on an all-inclusive. The smaller properties don't have the income to justify setting up complex international payment structures. Obviously you are right to an extent, not all businesses in DR disclose every cent of their income to DGII, honesty is not woven into the fabric of this society.
 
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MariaRubia

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Jun 25, 2019
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Don’t some of the smaller hotels in DR also use Airbnb? How does that work? We stayed at a boutique hotel in Zona Colonial awhile ago, and were chatting with a couple at the next table at breakfast. I think they were from from Seattle, which surprised me. I asked them how they found this small delightful hotel and they said Airbnb. That really surprised me!

Yes, but it works just the same when a hotel works with AirBnB, the hotel just pays commission to AirBnB rather than Booking.com. For hotels, AirBnB insists that the hotel pays the commission, but for apartments they allow the commission to be charged back to the guest as a "service fee".
 
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