Peterson said one area that will be rethought is the lodging taxation. “Lodging taxes are historically imposed on the operator of the facility,” Peterson said at Avalara’s Crush conference this month.
That means that Airbnb does not pay taxation on lodging booked through its services as it does not operate facilities. He said that this change, which needs to be accomplished at the city level, should “impose the tax on the person who has the money which will be Airbnb and Expedia,” Peterson said.
The decision is already having an impact on Avalara’s business. As states adopt economic nexus, businesses are looking for assistance in meeting the changing environment. ”We have seen a significant increase in new customer’s registering," Avalara's CEO Scott McFarlane said during this month’s webcast for earnings for the first quarter ended March 31.
The demand helped Avalara slash its loss and boost revenue. For the most recently ended quarter, it lost $9.2 million, 39.4 percent lower than the loss of $15.2 million a year ago. Revenue for period was slightly less than $85 million, up 38.4 percent from $61.3 million in last year’s corresponding period.