Italian authorities to confiscate $835 million from Airbnb in investigation into tax avoidance

Italian authorities have ordered the seizure of €779.5m from Airbnb, accusing the short-term rental giant of tax evasion. Prosecutors claim that the company failed to collect taxes from landlords on around €3.7bn of rental income. According to Italian law, landlords are obligated to pay a 21% tax on their earnings. Airbnb has expressed surprise and disappointment at the action, stating that it has been working with the Italian tax agency to address the issue since June. Three former Airbnb managers are also under investigation. Airbnb previously challenged the Italian law requiring the withholding of 21% rental income and payment to tax authorities, arguing that it violated the European Union's principle of free service provision. However, the EU's top court ruled that Airbnb must comply with the requirements. Italian authorities have recently focused on scrutinizing the tax practices of major companies operating in the country. Netflix and Meta have also faced tax-related inquiries. Italian politicians plan to crack down on landlords who fail to pay taxes on short-term rentals through platforms like Airbnb by introducing a national identification code. This move is expected to increase Italy's fiscal revenue by €1bn.