Friday afternoon, Gov. Charlie Baker signed into law a bill that seeks to tax and regulate short-term rentals like those offered at AirBnB and VRBO.
The bill passed in July, but was halted by Gov. Baker. The bill will apply a 5.7 percent mandatory state tax on short-term rentals. There are many short-term rental properties on Martha’s Vineyard, inherent to the largely seasonal tourist population. An amendment to the bill will exempt homeowners who rent units for 14 days a year or fewer from having to collect the tax. Cities and towns can decide to levy an additional 6 percent local excise tax and a 3 percent community impact fee. The bill also includes a local option for towns to add a 2.75 percent tax on short-term rentals that would go toward a Cape Cod and Islands Water Protection Fund to create wastewater management systems to clean up nitrogen pollution. As part of the bill, there will be a public registry for all short-term rental housing units.