Booking.com settles Italian tax dispute
The OTA welcomed the deal in a statement and agreed to pay about Euro 94 million to settle a tax dispute in Italy
Italy's Guardia di Finanza tax police alleged in June 2021 that Booking.com evaded 153 million euros of value added tax (VAT) in connection with holiday rentals from 2013 to 2019.
Key takeaways
- The probe concerned VAT in Italy on payments between private individuals for rental properties advertised by the online travel agent;
- Private accommodation sites which are not professionally run often have no VAT number, and Italian tax authorities believe the online travel agency should in such cases act as a withholding agent, collecting tax;
- The Italian tax police checked 896,500 property owners who worked with Booking.com and concluded it did not pay VAT due to Italy, saying they believe that failure to levy the tax allowed the business to undercut other hotel groups.
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