San Francisco Mayor Ed Lee signed a law on Monday that starting in February will legalize short-term rentals of 30 days or less with a 14.5% sales tax. This “sharing economy” business model has spawned the likes of Airbnb, an online business which was recently valued at US$13 billion and, coincidentally, is based in San Francisco.
Under the law, short-term rental hosts must register with the city and live on the premises nine months out of the year. It is estimated San Francisco will collect about US$11 million annually based on the sales tax.
Protestors continue to oppose the law as they believe it negatively impacts the housing supply and rental prices. They have also called for the payment of an estimated US$25 million in back taxes.