Mississippi legislators are considering measures that could redefine short-term rental properties, such as those on Airbnb and VRBO, as hotels, potentially subjecting them to increased taxation. House Bill 919 and Senate Bill 2805 propose that these rentals collect occupancy taxes similar to those already imposed on traditional hotels.
Hancock County Administrator Jimmie Ladner emphasized the importance of these bills for ensuring equity and increasing revenue. “It ensures that those rental units are collecting the occupancy tax that every hotel room in the state is already doing,” Ladner noted.
Currently, not all third-party rental operators include state and city lodging taxes in their fees. Should these bills pass, visitors may experience a slight rise in rental costs. However, Ladner highlighted the potential benefits for coastal cities, as the additional tax revenue would be reinvested into the tourism industry, a vital component of the local economy.
Senator Chris Johnson, who introduced the Senate bill, stated that the legislation aims to enhance the state’s tourism sector without burdening renters. Bay St. Louis homeowner Stephen Haas, who lists his property on VRBO, expressed support for the proposed changes, citing their potential to stabilize the legal framework for short-term rentals.
Ladner also pointed out that increased revenue from these taxes could enhance the Gulf Coast’s competitiveness as a tourist destination. By having these revenues, it’s going to put us in a position to compete with our competitors, referring to other popular coastal locations like Orange Beach, Alabama, and Galveston, Texas.
Both bills have progressed through their respective legislative bodies and must be approved by the other before being presented to the Governor. According to the Gulf Coast Business Council, coastal Mississippi hotels generated $387 million in revenue in 2023.
