OCEAN CITY, NJ — Authorities are floating the idea of a three percent occupancy tax that would apply to Airbnb and VRBO rental properties, and possibly hotels and motels as well, as a way to generate additional revenue for the city.
The occupancy tax ordinance was introduced in a 4-3 vote by a divided City Council at a recent meeting. It will be up for public hearing and final vote at the Dec. 5 meeting.
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Upon introduction, it was only intended for rentals on the “transient space marketplace,” which is rentals booked through online sites like Airbnb or VRBO.
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But council debated whether it was fair to only tax those online rentals and exclude hotels and motels.
“I think we’re picking winners and losers here,” Councilman Keith Hartzell said of excluding hotels and motels.
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“It seems like we’re not being consistent,” Councilman Dave Winslow said.
Council Vice President Terry Crowley had a different perspective. He wanted to go with the original ordinance so they could discuss further, calling it the “cleanest way” to “kick start” the process of adding additional revenue.
“I don’t think we’re considering everything,” Crowley said.
Ultimately, hotels and motels were added to the ordinance. Those already pay a five percent occupancy tax under state law. Ocean City’s occupancy tax would be paid by the tenant.
If approved at the December meeting, the tax would go into effect on Jan. 1, 2025.
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