NEW HANOVER COUNTY, NC (WWAY) — New Hanover County commissioners are hoping to have a new plan in place this summer to make it easier to collect occupancy taxes from people who rent their homes for short terms.
“Six percent isn’t a whole lot to the average person, but it means a lot when it’s added up for the county and the city,” said Wilmington Host Committee chairman Harry Smith.
A six percent room occupancy tax, that’s what New Hanover County collects from short term rentals. That money is used for things like beach renourishment and tourism.
With the increase in Airbnbs and VRBOs, the county wants to make sure they’re collecting what they’re owed.
“There are some individuals that may be renting out their properties and not reporting and this software will help us pick up any of those anomalies to make sure everyone is indeed doing their fair part and paying their fair share of those taxes,” said county commissioner Jonathan Barfield.
Last month, county commissioners approved a $41,000 audit program to help collect those taxes.
We spoke to one man who rents out his home in Wilmington. He had no idea he was required to pay room occupancy taxes.
Barfield says ignorance is not bliss.
“If you go to the grocery store and buy a pack of bubblegum, you’re gonna pay taxes on that,” Barfield said. “It should be no surprise to anyone that there are ROT, room occupancy taxes, that are paid when folks are staying in your facility.”
Smith, who advocates for short term rentals in our area, thinks this program could help local leaders throw their weight behind short term rentals moving forward.
“I think the biggest thing that could come out of it is that the city realize and the county realize how much money they’re making and maybe a little bit of regulation could go a very far way in promoting the county,” Smith said.
The county believes the increase in collected taxes will offset the $41,000 price tag.
The county is also developing an online portal to make it easier for rental property owners to file their room occupancy taxes.
Both the audit program and the online portal are expected to be in place July 1.