TRENTON — Saying it would “do real harm” to the state’s economy, Gov. Chris Christie on Friday vetoed a bill that would mandate online marketplaces such as Airbnb that offer short-term housing rentals be taxed the same way hotels are in New Jersey.
The Democratic-sponsored legislation would allow municipalities to impose sales and use taxes, as well as occupancy fees, as hotels are required to pay.
But Christie, a Republican, argued it would levy a new tax on property owners and likely lead to higher prices for renters.
“As I have said many times before, I strongly believe that levying new taxes on our already overtaxed residents is not the answer to the state’s fiscal challenges,” Christie wrote in his veto message. “The tax increase proposed in this bill would not only impact New Jersey property owners who have — for generations — made their homes available for short-term rentals, but would also disproportionally increase the cost of visiting New Jersey Shore towns and other tourist destinations.”
Both houses of the Democratic-controlled New Jersey Legislature passed the bill mostly along party lines — the state Senate last month by a vote of 25-13 and the state Assembly in May by a vote of 45-29.
Sponsors noted that the legislation was expected to to bring more than $6 million in tax revenue to the state and municipalities.
Short-term rental marketplaces allow people to list and book apartments, houses, villas, and even castles across the globe for a night, a week, or a month.
In New Jersey, about 6,100 residents hosted sites through Airbnb last year, renting to about 257,000 people. That led to $50 million in income for the renters.
Assemblywoman Annette Quijano (D-Union) said Friday that the bill “was about tax fairness and leveling the playing field among hospitality providers in the state.”
“Hotels and motels must pay taxes on the rooms they occupy,” Quijano said. “Rooms booked through Airbnb are exempt. This gives Airbnb an unfair advantage over the competition, and denies municipalities important tax revenue.”
She also said it appears Christie’s veto is “about the governor padding his Republican credentials, and rehashing his ‘no new taxes’ mantra regardless of the impact.”