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Comment by namecast | Hacker News Reader

....which works out to somewhere between one and two metrocard rides per city resident worth of annual lost tax revenue, and is only ~33% of the NYPD's annual settlement slush fund: http://www.reddit.com/r/news/comments/2j57fl/new_york_city_h... . This isn't buying us much in the way of services, I'm afraid.

Fellow NYC resident here, playing devils advocate: do you think the people renting these AirBNB units are contributing more or less than $33 million to the local economy by consuming local goods/services when they stay here?

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"do you think the people renting these AirBNB units are contributing more or less than $33 million to the local economy by consuming local goods/services when they stay here?"

You could argue that NJ visitors add revenue to the NYC economy when they ride the PATH into NYC, but that doesn't mean they get to hop the turnstile and ride in for free. Airbnb either needs to change the laws, or abide by them. Rationalizing violations citing the "greater good" won't fly in a city where travel and real estate are such valuable components of the economy.

Fully agreed. (And for the record, I'm absolutely not rationalizing their violations - just pointing out that "we're out $33 MM USD because lost tax revenue" is the wrong way to be looking at this. I think we should have some sort of safe harbour provision for people making X dollars a year off AirBNB, personally - once you're making more than the cost of your annual rent, time to pay some taxes.)

That's a weird question, isn't it? Let X be the amount of economic benefit short-term tenants bring to NYC. X < X+33MM.

That's a weird way of looking at money, isn't it?

Hypothetically: I have X dollars in my pocket for a trip to NYC. I can spend it on my hotel + the taxes that the hotel pays, or to an AirBNB host. All things being equal, let's assume AirBNB is cheaper for me because hosts don't pay these taxes, which means I get to keep a larger % of my X.

If I go for the hotel, I'm paying a larger % of my X for the rental (some of which is allocated to taxes), and less stays in my pocket, which means that less will be available for me to spend on the local economy (though it should be benefiting us locals indirectly via taxes, or so goes the theory.)

I'm not going to somehow magically find more money to spend in NYC if I choose to go with the hotel - I'm just going to spend less money, because I have less money, because I've spent more on my hotel.

Your math assumes that somehow I have the exact same amount of money to spend whether or not I choose AirBNB or a hotel, and also that the same number of short-term tenants will visit NYC regardless of the cost they realize paying for AirBNB vs. a hotel - and that further that these short-term tenants will spend the same amount of money on goods and services regardless of their rental costs.

I'm going to go out on a limb and say that's unlikely. :)

I do not think it's reasonable to believe that Airbnb enables so many new visits to NYC that it offsets the tax loophole, no.

Why are you excluding money spent on NYC hotel tax from money spent in the local economy?

From my comment:

"...less stays in my pocket, which means that less will be available for me to spend on the local economy (though it should be benefiting us locals indirectly via taxes, or so goes the theory.)"

I'm not excluding it, just acknowledging that money paid to the city via taxation at best takes an indirect route to benefiting local actors.

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