SWAMPSCOTT — The town is looking to generate revenue by taxing short-term rentals, such as Airbnb, and marijuana retailers.
Town Meeting members will vote on the revenue opportunity at the annual Town Meeting on May 20. If amended, Article 22 will impose a local option community-impact fee of 3 percent of the rent upon each transfer of occupancy of short-term rental units in a two- or three-family dwelling that includes the operator’s primary residence. It will also impose a 3 percent local sales tax on the sale or transfer of marijuana or marijuana products in town.
“It would allow the town to generate revenue in the event we would have enterprises that would want to take advantage of recently passed state laws,” said Town Administrator Sean Fitzgerald.
He said the recreational marijuana law, as amended by the state legislature, allows municipalities to adopt the 3 percent local option tax in addition to the state sales tax of 6.25 percent and state excise tax of 10.75 percent. It is similar to the local option meals tax and local option rooms tax Swampscott has already adopted, he said.
“The additional revenue would provide a backup if the community impact fees from the (Cannabis Control Commission, CCC) mandated Host Community Agreement (HCA) do not cover the entire cost to the community of this new industry,” he said.
In order to be a licensed retailer, marijuana establishments or medical marijauana treatment centers must execute a HCA with the municipality in which it intends to be located, according to CCC.
“This is simply looking to allow the town to capture additional revenue, no marijuana business is currently being advanced for Swampscott,” said Fitzgerald.
The push towards a local option impact community fee for short-term rentals in town was inspired by the bill signed by Gov. Charlie Baker late last year, which allows the taxing of Airbnb and short-term rentals throughout the state, according to Fitzgerald.
“We were once the resort capital of New England,” he said. “Swampscott is still a wonderful place to visit.”
The Board of Selectmen recommended favorable action on the article and the Finance Committee will report their recommendation at Town Meeting.
“Both these local options would help bring new non-local real estate tax revenue to Swampscott and be helpful as we seek to mitigate the financial impact on the town’s taxpayers,” Fitzgerald said.