Hearing tackles illegal rentals and other DRT issues

Department of Revenue and Taxation (PNC file photo)

How successful has the Department of Revenue and Taxation been in collecting hotel occupancy taxes and licensing fees from Guam’s Airbnbs and short term rentals? And how successful has it been in enforcing and ensuring…that these businesses are complying with Guam law? Today DRT brought legislators up to speed on their progress.

It has been over a year since a PNC investigation found that there were over 300 listings for Guam on airbnb.com despite the fact that at the time, there were only 16 licensed at the Department of Revenue and Taxation.

Then DRT Director John Camacho told PNC that they have a draft MOU with Airbnb and that they were trying to secure an agreement in which Airbnb would collect on behalf of the government.

Six months ago, another PNC investigation uncovered an underground Korean tourist lodging rental industry. According to Mary Rhodes, president of the Guam Hotel and Restaurant Association, these untaxed, illegitimate businesses rake in $23 million in revenue on Guam annually – revenue our island loses out on.

You may recall that DRT set up a task force and reported making progress in uncovering this well-planned black market industry.

However, like many other Govguam agencies, DRT has been faced with challenges.

“Of course we had a shortage of manpower and so it is a bit challenging in terms of manpower,” DRT director Daphne Shimizu said.

Other challenges facing the department are outdated computer systems and a serious deficiency in critical operational resources such as digital cameras, two-way radios, and training.

DRT also provided updates on the impact of the tax cuts and Jobs Act of 2017, and revenues associated with the military build-up.