The Warren County Board of Commissioners will hold a public hearing at their Monday, June 3, 2024 regular meeting at 6 p.m. to hear public comment about the proposed occupancy tax for short-term rental accommodations in Warren County.
A local occupancy tax applies to the same transactions that are subject to state sales taxes on accommodations mandated by general statutes.
Occupancy taxes on short-term rentals are not levied against the property/business owner; they are levied on the occupant/renter. However, facilitators, rental agents, and business owners engaged in short-term rental accommodations are required to charge the occupancy taxes to the occupant and to remit that revenue to the local government.
In 2023, the General Assembly granted Warren County the authority to levy an occupancy tax up to 5 percent. The approval for the occupancy tax can be found in N.C.S.L. 2023-144, Senate Bill 154, Part 13.
A short-term rental accommodation subject to a local occupancy tax is anything supplied to one person for less than 90 days. Short-term accommodations include hotel and motel rooms, residences, cottages, or a similar lodging facility, as well as any type of structure that is rented for temporary residential use such as houseboats, tents, yurts and train cabooses. Parking spots for recreational vehicles, campsites, and boat slips would not be subject to local occupancy taxes. Occupancy taxes do not apply to enrollment in school, camp or hospital programs.
Occupancy taxes apply to the cost of the accommodation rental, as well as to other mandatory charges of the rental, such as early or late departure fees, cleaning fees, pet fees, etc. (all mandatory charges that are directly related to the use and occupancy of a rental accommodation).
The three parties held liable for collecting occupancy taxes from tenants and for remitting the taxes locally are: retailers (ex: hotel operators, bed and breakfast operators), facilitators (ex: Airbnb, Vrbo), and rental agents (brokers and other persons engaged in property management).
The penalties for delinquent occupancy taxes are the same as the penalties for delinquent sales taxes. Counties are allowed to enforce collection remedies with the exception of placing liens on properties and governments cannot foreclose on properties that do not property remit their occupancy tax collections. Occupancy taxes are not subject to successor liability (they do not go with the property when it is sold).
For more information, visit www.warrencountync.com or email Charla Duncan, Director of Warren County Community and Economic Development, at charladuncan@warrencountync.gov.
