October 11, 2023, marked a significant shift in Loudoun County’s approach to regulating short-term rental operations. During a recent public hearing, the Board of Supervisors enacted amendments to the Codified Ordinances of Loudoun County, specifically targeting the fiscal obligations of accommodations intermediaries like Airbnb and VRBO.
The core change revolves around Chapter 878, known as the Transient Occupancy Tax (TOT). Under the new regulations, all platforms facilitating room rentals must now undertake a more stringent reporting process. They are mandated to disclose and forward TOT revenues on a monthly schedule, submitting payments no later than the 20th day following a month’s conclusion. However, it’s critical to note that these legal stipulations are not enforceable within the boundaries of incorporated towns residing in Loudoun County.
This strategic move is backed by Virginia Code ยงยง 58.1-3819 through 58.1-3827, which empowers regional administrative bodies across counties, cities, and towns to impose TOT. This tax applies to a range of lodging facilities, including hotels, motels, boarding houses, travel campgrounds, and any venues offering guest rooms for short-term stays – specifically, those lasting less than 30 consecutive days.
The financial architecture of the TOT is such that room rental revenues are taxed at 8%, where allocations are distinctly earmarked for various countywide initiatives. Of the total percentage, 2% is directed into Loudoun County’s General Fund. Concurrently, 3% is reserved for a dedicated fund aimed at bolstering tourism, while the remaining 3% is channeled to fortify transportation infrastructures within northern Virginia.
For accommodation intermediaries, the revised TOT ordinance takes effect immediately, signaling an urgent need for compliance. Conversely, operators of other lodging establishments receive a grace period, with the amendments becoming applicable on April 1, 2024. Through these measures, Loudoun County underscores its commitment to ensuring fair business practices, securing vital revenue streams, and investing in its community’s sustainable development.
