Cape Town’s proposed Airbnb rates “tax.”
The City of Cape Town’s recent announcement regarding a "tax crackdown" on short-term rentals has sent ripples through the property market. However, a closer look at the proposed Short-Term Letting By-law reveals that this is less about a brand-new tax and more about the rigorous enforcement of existing municipal structures to address the city’s evolving housing and economic landscape. As Cape Town continues to be a global tourism magnet, the explosion of platforms like Airbnb—now boasting over 26,000 listings in the metro—has created a complex challenge for city planners. Shifting from Residential to Commercial The core of the City’s argument rests on the intended use of a property. Currently, many dedicated short-term rentals operate within residential zones while paying residential property rates. The City contends that when a property is used exclusively or primarily for short-term guests, it ceases to be a "home" and becomes a "decentralized hotel."...