News Summary
Charleston County has accepted a $9.6 million settlement from Airbnb, part of a larger lawsuit regarding unpaid accommodations taxes and business license fees affecting multiple municipalities in South Carolina. The lawsuit, initiated in 2021, alleges rental platforms failed to remit collected taxes. The County Council is now exploring options for allocating these funds to community projects, enhancing infrastructure, drainage, and affordable housing initiatives.
Charleston County has accepted a settlement of $9.6 million from Airbnb as part of a larger lawsuit concerning unpaid accommodations taxes and business license fees. This settlement was reached as part of a multi-city lawsuit that has involved several South Carolina municipalities, including Charleston, North Charleston, Columbia, Myrtle Beach, Folly Beach, Isle of Palms, and North Myrtle Beach. The legal action was initiated in 2021 and focuses on the allegations that Airbnb, as well as other rental platforms like VRBO and TripAdvisor, failed to collect and remit local taxes despite collecting them from rental operators and vacationers.
The lawsuit established a total settlement pool of $60 million for affected municipalities, with Charleston County settling for the aforementioned $9.6 million in February 2023. Though Charleston has reached a settlement, ongoing litigation continues against other rental companies involved in the case.
In a County Council meeting held on April 29, council members voted unanimously to explore how best to allocate the settlement funds. The council has directed staff to compile a list prioritizing potential projects or areas of need within the community. By moving the funds from the accommodations tax into council contingency funds, the council aims to increase flexibility in how the money can be spent.
Council Chairman Kylon Middleton has indicated that the funds could be used for various community projects, including infrastructure improvements, drainage enhancements, and affordable housing initiatives. The Accommodations Tax levied in Charleston County is currently set at 2%, which helps create a loan fund aimed at supporting affordable housing. For the upcoming year, the county anticipates generating nearly $12 million from this tax.
Other localities within the Lowcountry region, such as Mount Pleasant and Isle of Palms, have also reached settlements linked to the same lawsuit. Mount Pleasant received $4.42 million, while Isle of Palms settled for $1.1 million, contributing to the total statewide effort to address the issue of unpaid taxes by short-term rental companies.
The matter of short-term rentals and the regulations governing them has led to disputes in various communities across South Carolina. In response to these issues, local jurisdictions like Charleston and Folly Beach have imposed caps on rental licenses in an effort to manage the impact of such rentals on neighborhoods and local economies.
Complaints raised in the lawsuit highlighted that rental companies were allegedly collecting accommodations taxes from guests yet failing to remit those funds to local municipalities. This situation have raised concerns about the financial ramifications for city services that rely on these taxes to operate effectively.
As discussions continue among Charleston County officials regarding the ultimate use of the settlement funds, no definitive decisions have yet been made on specific projects or allocations. The upcoming months will likely clarify how the county plans to leverage this unexpected influx of funds to address pressing community needs and improve infrastructure, housing, and other critical areas.
In summary, Charleston County’s acceptance of the $9.6 million settlement from Airbnb is a significant step in a broader legal battle focused on ensuring compliance with local tax laws. The allocation of these funds remains a priority for the County Council as they seek to maximize the benefits for the community.
Deeper Dive: News & Info About This Topic
HERE Resources
South Carolina’s Tourism Sector Sees Significant Growth
Charleston and Isle of Palms Reach Agreement with Rental Companies
Additional Resources
- Post and Courier: Charleston County Airbnb Lawsuit Settlement
- AOL: $60M Hilton Head & Port Royal Settlement
- WBTW: North Myrtle Beach to Get $2M Settlement
- Wikipedia: Short-term rental
- Encyclopedia Britannica: Lease
Author: STAFF HERE CHARLESTON
The CHARLESTON STAFF WRITER represents the experienced team at HEREcharleston.com, your go-to source for actionable local news and information in Charleston, Charleston County, and beyond. Specializing in "news you can use," we cover essential topics like product reviews for personal and business needs, local business directories, politics, real estate trends, neighborhood insights, and state news affecting the area—with deep expertise drawn from years of dedicated reporting and strong community input, including local press releases and business updates. We deliver top reporting on high-value events such as the Spoleto Festival USA, Charleston Wine + Food Festival, and the MOJA Festival. Our coverage extends to key organizations like the Charleston Metro Chamber of Commerce and the Charleston Museum, plus leading businesses in tourism and maritime industries that power the local economy such as South Carolina Ports Authority and the Charleston Visitor Center. As part of the broader HERE network, including HEREaiken.com, HEREbeaufort.com, HEREchapin.com, HEREcharleston.com, HEREclinton.com, HEREcolumbia.com, HEREgeorgetown.com, HEREgreenwood.com, HEREgreenville.com, HEREhiltonhead.com, HEREirmo.com, HEREmyrtlebeach.com, HEREnewberry.com, HERErockhill.com, HEREspartanburg.com, HEREaustin.com, HEREcollegestation.com, HEREdallas.com, HEREhouston.com, and HEREsanantonio.com, we provide comprehensive, credible insights into South Carolina's dynamic landscape.
