Homeowners in the Mexican state of Quintana Roo are now required to have a license to rent out their property through digital platforms like Airbnb. Moreover, they are required to pay an occupancy tax of 6%, which is 1% more than traditional hotels pay. Such requirements are contained in the new edition of the Rules for the Registration of Digital Platforms in the State of Quintana Roo, prepared by the State Tax Service (SAT) of the state. Changes to the Rules have already entered into force.
The state of Quintana Roo on Mexico's Caribbean coast is home to sought-after resorts such as Cancun, Playa del Carmen and Tulum, and investment in rental housing has fueled a strong real estate market along the coast for many years. At the end of last year, there were more than 35,000 vacation rental units in Quintana Roo at average prices ranging from $44 to $99 per night, according to Manuel Alonso Alvarez, president of the local Rental Housing Association.
The requirement to have a license in order to rent out housing existed previously. However, the license must now be obtained not from the municipality, but from the SAT, and digital platforms are required to verify this license. In addition, platforms are required to automatically withdraw the accommodation tax and transfer it to the budget, as they do with income tax and VAT on the cost of services provided by the owner of the property to tenants. The homeowner can partially administer these taxes and make tax deductions at the State Tax Service. Airbnb automatically charges users 4% income tax (ISR) and 8% VAT (50% of the 16% rate) for those registered with SAT and having an RFC tax number, and 20% income tax and 16% VAT for those without an RFC. However, it is now impossible to place an advertisement for housing on digital platforms without an RFC.
The basic occupancy tax rate for 2023 is 5%, paid by traditional hotels and those who rent accommodation directly. However, when renting housing through digital commerce platforms, the rate is already 6%, according to the Law on Accommodation Tax of the State of Quintana Roo. The occupancy tax is passed directly onto the person renting the property.
Currently, the only digital platform that has a partnership agreement with the state government is Airbnb, but the rules governing digital platforms apply to all similar sites.
According to Manuel Alonso Alvarez, the private home vacation rental market (short-term rentals) has recently grown even faster than before the pandemic. However, he notes that this is now happening despite a decrease in rental costs due to a sharp increase in the supply of such housing at the national level, the opening of other tourist markets, such as Europe, after the pandemic, and also inflation in the United States.