the success of airbnb

jo van hove airbnb

recently i put my apartment on airbnb with the main idea to have a bit of pocket money to travel

so there i went : making a description, deciding about the price, making some nice pictures, buying some new bed linnen, etc etc…  quite some work !!

this is the result

i was waiting for the first guest to book

and waw : only one day later i was a bit in a panic because a booking came in – never expected that so fast !

when a guest comes in – cleaning the house, preparing everything at the cosiest and cleanest possible – which took me more than 2 hours

during the entire cleaning before, during and after the stay – i was wondering what makes airbnb a so great experience

three things strike me the most

  1. it’s easy to get in and easy to set up
  2. airbnb takes care of the money – so you are hassle free with your guests and the money transfer is instant
  3. airbnb works completely on social surveillance with ratings and reviews and comments that make it really safe to accept guests – you cannot afford to rent out a filthy room and guest cannot afford to behave like animals because you want a good rating because good ratings means income

it s a real smart system – based on trust and confidence – i just love it

except that politicians are now walking in the trap of the ‘hotel lobby’ (got that ? 😉 ) – it s a real shame – airbnb is very wel regulated by guests and hosts – no room for excesses

i can agree with a simple tax system for people really living from airbnb rentals – which is not my case – but please keep it simple and not like what i found for belgium

in brief : when airbnb hosts have less than 25000€ rental income per year - no taxes are applied to the renting of the space itself, but only to the services like breakfast and cleaning - which are considered by default 20% of the rental

so hosts have to pay actually 20% taxes on 50% of the 20%... you follow ?  in reality 10% of your rental will go to the state
as long as the sites where you advertise are 'recognised' by the state

but once the 20% exceeds the sum of 5000€ per year (so more than 25000€ rental) - the income is considered 'professional' and the host will need to pay 34% of the entire rental to the state

also above 25000€ rental revenu the host will need to get a vat number and will need to pay an additional 21% of vat to the state

and we re not talking about local tourist taxes yet

it becomes all too complex : why not apply the T20 rule ?  for everything you sell or rent out : pay 20% taxes – regardless how much you earn – it’s easy, it’s simple and it won’t hurt anyone…

reverse economics

a couple of weeks ago, my youngest daughter came home with a new set of trousers
“great ! only 17,99€ dad !!”
not bad – but it felt a bit strange and i started calculating
please follow me in a reverse calculation of the cost of the trousers from a spanish brand and made in bangladesh

minus 21% vat
= 14,86€ for :

  • 500m2 of shop space in a Namur prime location
  • advertising / photography / model / website / online shop
  • at least 10 full or half time staff
  • local taxes
  • transport costs from central depot to shop
  • treatment by staff
  • transport costs from antwerp harbour to central depot
  • designers
  • administrative people
  • the bosses and their large cars
  • EU import taxes
  • transport by ship from bangladesh
  • transport to harbour
  • packing
  • factory workers and factory
  • local taxes
  • transport
  • cloths (68% cotton, 28% polyester, 4% elastane)
  • colouring of the cloths
  • weavers
  • transport
  • the cotton workers

so i wonder what the cotton workers have received from the 14,86€ ?
knowing also that for the january online sales – ‘everything must go !’ – the same trousers were discounted to 7€ – vat included with free shipping to your home (!!!!????)

the same trousers made entirely in belgium would probably costs around 100€ or more

i know i know – globalisation is giving some bangladesh people a small income – but again at what price ?
shouldn t this big spanish company or any company using remote labour be asked – if not forced – to detail how they can price that sharply ?

thinking about this all – i feel really awkward…

i wouldn t mind spend a couple of euros more to the same trousers if i was sure the bangladesh workers would get a decent loan

but who can assure those extra € would not disappear in the pockets of the sub-contractors ?