Tax Increase for Short-Term Rentals Sparks Controversy in Upcoming Legislative Session
In a move that has sparked controversy across the state, a committee of lawmakers have agreed to move forward with a bill that would significantly increase property taxes for short-term rental properties.
The bill, developed by the Legislative Oversight Committee Concerning Tax Policy & Task Force, would classify any property used as a short-term rental for more than 90 days per year as a lodging property, resulting in nearly quadruple property taxes for an estimated 24,000 properties.
The bill has been met with strong opposition from short-term rental owners, who argue that they should not be taxed at the same rate as hotels and other traditional lodging properties. However, proponents of the bill argue that these properties should be treated equally since they are being used for commercial purposes, rather than being classified as residential properties.
If passed during the 2024 legislative session, the bill would require short-term rental owners to submit a signed affidavit stating the number of days their property was used for this purpose in the previous year. Lying on the affidavit would be considered perjury, with potential fines and jail time for those found guilty.
Despite concerns and opposition from some lawmakers, including Rep. Julie Amabile, who believes the bill needs more work to address the potential unintended consequences in different communities, the bill has been given the green light to move forward to the full legislature.
The bill's sponsors, House Speaker Julie McCluskie and Rep. Mike Weissman, have expressed their commitment to continue working with constituents and finding solutions that benefit all parties involved.
The potential increase in property tax revenue, estimated to be $371 million beginning in 2026, has caught the attention of many.
With the General Assembly having considered similar bills in the past, it remains to be seen if this bill will have enough support to pass.
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Governor Jared Polis has also weighed in on the issue, voicing his support for the 90-day limit on short-term rentals being classified as residential. However, with the bill passing along party lines through committee, with Democrats in favor and Republicans against, it is clear that this is a divisive issue that will require further discussion and debate.
As the bill moves forward to the full legislature, all eyes will be on the lawmakers as they continue to consider the implications of this proposed tax increase for short-term rental properties.
Elections have consequences.