|We want to express our appreciation to all permits holders who year after year provide memorable guest experiences while offering a variety of lodging options for those who visit Door County.|
Prior to 2007, Door County had only approximately $200,000 to market itself, which wasn’t keeping us competitive with other tourism destinations across the state, resulting in a decrease in market share. Looking forward to 2020, we will cross the threshold of $5 million in room tax collections with a projected $3.4 million to be directed to Destination Door County to market all of Door County. An additional $1.5 million is projected to support our member municipalities. While this growth is reason to celebrate, we have challenges to face together.
For room tax to continue to support our local municipalities and provide funding for destination marketing, our partnership is going to be essential to navigate our way through some difficult challenges. Patience and big picture understanding are going to be required for everyone involved in this process. The changes related to WI ACT 10 that we have been communicating to you via email over the past weeks come from the State Legislature. The roll out by the Marketplace Providers comes directly from their own internal programming.
We’ve spent over two years educating, advocating and creating correcting legislation in effort to fix the issues with WI ACT 59 and now WI ACT 10 (bills are related in their intent). So far, it has proven to be a challenge to effectuate change. As it stands, we must move forward and manage with the new legislation while complying with statutory requirements for distribution of room tax back to the municipality it was collected in. In order to do so, the process of reporting municipal room tax will adjust in order to achieve equity and transparency among the beneficiaries of room tax.
NOTE: This information is being sent to all owners on record. If you have a responsible party designated to handle your property management and reporting of local municipal room tax, it is your responsibility to see that this information is forwarded to your responsible party.
THE DETAILS:WIS ACT 10 was passed in July 2019: A marketplace provider (lodging platform) is required to collect and remit sales and local municipal room taxes for all sales of taxable products and services in Wisconsin that the marketplace provider facilitates on behalf of a marketplace seller.Note: A marketplace provider is required to collect and remit tax on the entire amount charged to a purchaser, including any amount charged by the marketplace provider for facilitating the sale (traveler service fees).If your provider is collecting local municipal room tax, include the service fee total in your gross earnings, as the marketplace provider is calculating tax on the service fee charged to the traveler.If you are in the Village of Sister Bay, you need to find out if your provider is collecting PRAT tax for you. Otherwise you will need to determine how to collect and remit it to the WI DOR. (.5% PRAT)This legislation applies to all property types (resorts, motel, hotels, homes, condos, & etc.) that utilize an online marketplace provider who processes the payment for lodging sales.A marketplace provider is required to notify the marketplace seller that the marketplace provider is collecting and remitting Wisconsin sales or use tax on all taxable sales, as provided in sec. 77.523(2), Wis. Stats.It is essential that you understand and verify how each marketplace provider that you engage with is handling local municipal room tax collection for each of your listings.If you use Evolve, Airbnb Custom Taxes (as of 1/23/2020 the status of Airbnb custom taxes is unknown- if you have selected this option, please contact Airbnb for an update) or have other agreements in place with your marketplace provider(s) in which local municipal room tax is remitted to you, please get written confirmation that taxes are being remitted to you. You need to confirm how they are handling the taxes on service fees (they should be remitted to you as well). You will complete the report form as you always have; skip SECTION 7 by entering $0’s. If you had bookings for 2020 that were made in 2019 you will see that local municipal room tax was not collected on these reservations. (They will be handled as a direct booking- no need to enter any information on these reservations in SECTION 7 as you will be paying local municipal room tax on these reservations).The municipal room tax reporting requirements remain unchanged. You will report as you always have for each of your permitted operating months (and any additional rentals outside your permitted months).A new local municipal room tax report is included in this communication. The online report form will be updated as well.The Door County Tourism Zone will require permit holders who utilize marketplace providers that collect room tax to report how much room tax was paid on your behalf. The information in SECTION 7 of the new report form is necessary because we may receive one bulk check for properties that utilize these services. The Tourism Zone is not given information as to which property is being paid on. The online companies tell us that it is confidential information between the owner and the platform, therefore they will not supply any information along with bulk payments. Required information in the monthly room tax report form provides the Tourism Zone with the information necessary to ensure that your room tax will be distributed back to the municipality in which it was collected per State Statute. Failure to provide payment information will deem room tax delinquent and late fees and interest will be assessed. Marketplace providers have essential back office reporting that should make the reporting process efficient and very straightforward for you. If you use a provider not covered below, please inquire with your provider about back office reporting that will provide the amount of tax paid on your behalf.VRBO/HomeAway: While we have located steps to running reports with VRBO, we can’t confirm how useful they will be at this point because hosts are unable to run reports into the future. If you encounter issues, please reach out to VRBO and insist they provide you with a report that can be run based on departure date (not payment date) that provides you with: departure date, nights rented, gross earnings (all taxable revenue including traveler service fees) and taxes they remitted. A payout report will not provide the information you need. The links below are to assist you with navigating to the Marketplace Platform sites for more information.VRBO Help:VRBO payments report: Steps: Login, click on reservations manager, click on payments, click on download icon (small icon), select the report month dates, click submit, wait for download, save to a folder that you can reference/run totals. You may need to select the type of report from a drop-down box (VRBO didn’t provide details on this step).Alternatively, if you encounter challenges with the VRBO report, you can access all the essential information by opening reservations within your inbox and clicking on “view full traveler payment detail”. This will show you the complete payment detail.Airbnb:“Gross Earnings” from Airbnb as shown on the host’s secure Airbnb login. (Host>Transaction History> Click on Gross Earnings (upper right of the screen). Please pay attention to the Nights, Gross Earnings and the Occupancy Tax columns – these columns will give you all the information you need to complete your reporting. The payout report will not give you the information you need.Please, no written communication on the monthly room tax report form: If you need to communicate with the Tourism Zone office, please contact the office via email or phone. If you need to report updated operating months that differ from your permit, please contact the office directly. We have removed this section from the monthly room tax report to streamline the entry process.This communication is being forwarded to assist you with how to be prepared, aware and responsible for your online listings with various marketplace providers with the provisions of Wisconsin ACT 10. We want you to understand that obtaining the required information on the new report form is the only way the Tourism Zone can provide your municipality its distribution of local municipal room tax. As more questions are answered and as the process unfolds with dealing with marketplace providers, all reference materials will be updated. In the meantime, watch for communications as we gain more information from the marketplace providers and the State of WI.
Finally, we appreciate the efforts by Representative Kitchens to assist with putting forth correcting language for WIS ACT 10, via AB683/SB646. He has been a great resource and advocate in communicating to the legislature the issues associated with WI ACT 10. If you get a chance, please thank him for his efforts. You can keep up with the progress of AB683/SB646 here.
Thank you for your efforts. Your partnership truly makes it possible for Door County to remain a top tourism destination. The room tax revenues you collect and remit support marketing that builds the awareness and desirability of Door County as a vacation destination. Further, many of our member municipalities continue to re-invest into tourism infrastructure that not only is desirable to those who visit but improves the communities of those who make Door County home whether it be part time or full time.