Airbnb Regulation in Cebu: What You Need to Know
Cebu’s hospitality industry is currently seeing a strong push for greater regulation of Airbnb operators, primarily spearheaded by the Hotel, Resort, and Restaurant Association of Cebu (HRRAC). The core argument is that without standardized regulations and tax compliance, Airbnb poses unfair competition to traditional hotels and resorts.
The Stance of HRRAC
The Hotel, Resort, and Restaurant Association of Cebu (HRRAC) has been quite vocal about the need to regulate Airbnb in Cebu. According to HRRAC, Airbnb operators are not playing by the same rules as established hotels and resorts, which creates an uneven playing field. In December 2024, HRRAC took a significant step by submitting a formal position paper to the Department of Tourism (DOT). This paper strongly advocated for stricter oversight and enforcement of regulations concerning Airbnb operations. The association believes that all accommodation providers should adhere to the same standards and legal requirements.
Furthermore, HRRAC has urged the Bureau of Internal Revenue (BIR) to ensure that Airbnb operators are fully compliant with tax laws. HRRAC President Alfred Reyes has emphasized the critical importance of fair competition. He argues that if Airbnb operators are not adhering to the same regulatory and tax frameworks as traditional hotels, it undermines the entire hospitality sector’s recovery and growth.
This issue is still very much alive. In January 2025, HRRAC restated its call for Airbnb regulation, pushing for a level playing field within the hospitality sector. The association intends to bring the issue to Congress, advocating for the creation of laws that ensure fair competition and proper taxation for all accommodation providers, regardless of whether they are hotels or Airbnb listings.
In May 2019, the association voiced early concerns about Airbnb impacting the market share of hotels in Cebu. Former HRRAC President Carlo Suarez pointed out that Airbnb was significantly “eating up the market of the hotels,” especially during peak seasons and events like the Sinulog Festival. Since then, HRRAC has been working with the DOT to develop accreditation standards for Airbnb hosts to improve safety, security, and overall fairness in the market.
BIR’s Crackdown on Unregistered Properties
The Bureau of Internal Revenue (BIR) isn’t sitting on the sidelines either. In October 2024, BIR-13 Regional Director Douglas Rufino revealed a concerning statistic: over 60% of rental properties in Cebu and Bohol were unregistered, and a significant portion of these were Airbnb units. This means many Airbnb hosts were potentially not paying the correct taxes.
Rufino specifically noted that there were many unregistered condominium units and boarding houses operating illegally in the Tri-Cities area, which comprises Mandaue, Lapu-Lapu, and Cebu. He urged property developers and boarding house owners to register their properties with the BIR, making it clear that failure to do so would have consequences. The warning came with a specific penalty in mind: first-time offenders could face fines of up to P50,000.
To further pursue this crackdown, in October 2024, BIR-7 also stepped up its efforts to find unregistered Airbnb units operating in Cebu. Regional Director Douglas Rufino reiterated that numerous condo units and other properties had been converted into short-term rentals via Airbnb without adhering to proper registration and tax compliance. The BIR is collaborating with condominium management to ensure that unit owners register their properties with the agency. Non-compliance could result in significant fines, as a reminder to the Airbnb landlords in Cebu.
Local Government Concerns and Actions
The local government units in Cebu are also taking steps to address the Airbnb situation. Back in September 2020, the Lapu-Lapu City Government discouraged the use of homestay applications such as Airbnb. The primary reason cited was the weak monitoring mechanisms for ensuring compliance with minimum public health standards. This was particularly relevant given the ongoing COVID-19 pandemic.
In response to the need for better oversight, an executive order was issued, which mandated the creation of the “Balik Turismo Task Force.” This task force was specifically designed to oversee the reopening of the city’s tourism industry, and a key part of its mission was to ensure stricter monitoring of all accommodations to protect public health safety. This included Airbnb properties.
Prior to the pandemic, in January 2020, the Lapu-Lapu City Tourism Office was already pushing for the registration and accreditation of all tourism enterprises, including Airbnb properties. This initiative was in compliance with the Tourism Act of 2009, which aims to create a level playing field within the accommodation sector. The goal was that all properties needed to secure a Tourist Compliance Certificate before they could obtain a business permit, ensuring that everyone was operating under the same rules.
Why the Push for Regulation?
The push for regulating Airbnb in Cebu stems from several key concerns. The most pressing issue is the perceived unfair competition. Hotels and resorts are subject to numerous regulations, including strict safety standards, health requirements, and tax obligations. These regulations come with significant costs. Airbnb operators, on the other hand, are often seen as operating outside of these frameworks, giving them a cost advantage.
Specifically, HRRAC President Alfred Reyes explained in January 2025 that Airbnb operators often avoid paying taxes, allowing them to offer lower prices compared to hotels and resorts. He emphasized that regulation is needed to establish clear safety, health, and quality standards for Airbnb properties, which will help to ensure greater protection for travelers.
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Another crucial point is safety and security. Hotels are generally equipped with security personnel, fire safety systems, and other measures to protect their guests. There are concerns that not all Airbnb properties meet these same standards, potentially putting travelers at risk. Regulation could help ensure that all accommodations, including Airbnb rentals, adhere to minimum safety requirements.
Finally, there’s the issue of quality control. Hotels often have established quality assurance programs to maintain consistent
standards of cleanliness, service, and amenities. The quality of Airbnb properties can vary widely, and guests sometimes face unpleasant surprises. Regulation could help to establish baseline quality standards for Airbnb rentals, improving the overall experience for tourists.
The Future of Airbnb in Cebu
The debate surrounding Airbnb regulation in Cebu is ongoing, with HRRAC planning to bring the issue before Congress to advocate for new laws. The association hopes to create a legal framework that ensures fair competition and proper taxation for all accommodation providers in the region.
It is likely that in the future, Airbnb operators in Cebu will face greater scrutiny and be required to comply with stricter regulations. This could include registering with the local government, obtaining necessary permits, adhering to safety and health standards, and paying all applicable taxes. The goal is not necessarily to eliminate Airbnb, but rather to ensure that it operates in a fair and responsible manner that benefits both the tourism industry and the local economy.
For travelers, this could mean increased peace of mind knowing that Airbnb properties are subject to certain standards. For hotels and resorts, it could mean a more level playing field, where everyone is competing on a fair basis. And for the government, it could mean increased tax revenues that can be used to fund public services.
Impact on Tourists
So, what does this all mean for tourists visiting Cebu? Well, in the short term, not much might change immediately. However, over time, the increasing regulation of Airbnb could lead to several noticeable effects.
First, you might see a slight increase in the prices of some Airbnb listings. This is because hosts who were previously avoiding taxes or cutting corners on safety measures will need to factor those costs into their pricing. However, this price increase could be offset by improvements in the quality and safety of the accommodations.
Second, you might find it easier to find reliable and safe Airbnb rentals. With stricter regulations in place, hosts will be more likely to maintain their properties to a higher standard to avoid penalties or losing their permits. This could mean cleaner accommodations, better amenities, and more responsive hosts.
Third, you might experience a more level playing field between hotels and Airbnb. With both types of accommodation providers subject to similar regulations and tax obligations, you’ll be able to make your choice based on personal preferences rather than just price. If you prefer the amenities and services of a hotel, you can choose that option. If you prefer the unique experience and local flavor of an Airbnb, that will still be available, but with greater assurance of quality and safety.
What Airbnb Hosts Need to Do
If you’re an Airbnb host in Cebu, it’s essential to stay informed about the evolving regulatory landscape. Here are some steps you can take to ensure you’re in compliance:
Register Your Property: Make sure your Airbnb property is registered with the local government and the BIR. This is the first and most important step toward legal compliance. Contact your local city hall or the BIR office to inquire about the specific registration requirements in your area.
Obtain Necessary Permits: Determine what permits you need to operate a short-term rental in your area. This may include a business permit, a tourism permit, or other specialized permits. Again, your local city hall or tourism office can provide you with the necessary information.
Comply with Safety and Health Standards: Ensure that your property meets all applicable safety and health standards. This may include installing smoke detectors and fire extinguishers, providing adequate ventilation, maintaining clean and sanitary conditions, and adhering to building codes.
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Pay Your Taxes: Make sure you’re paying all applicable taxes on your Airbnb income, including income tax, value-added tax (VAT), and local business taxes. Keep accurate records of your income and expenses so you can file your tax returns correctly.
Stay Updated: Keep abreast of any changes to the regulations governing Airbnb in Cebu. Attend workshops or seminars organized by HRRAC, the DOT, or other relevant organizations. Subscribe to industry newsletters and follow reputable news sources to stay informed.
Join HRRAC: Consider joining HRRAC to add your voice to the discussions shaping the future of the hospitality industry in Cebu. By working together, Airbnb hosts and traditional hotels can advocate for regulations that are fair, reasonable, and beneficial to all stakeholders.
FAQ About Airbnb Regulations in Cebu
Q: Why is HRRAC pushing for Airbnb regulation?
A: HRRAC believes that Airbnb operators have an unfair advantage because they often don’t comply with the same regulations and tax requirements as hotels. This creates an uneven playing field and puts hotels at a disadvantage. So, HRRAC hopes to create new laws to address what it sees as unfair advantages.
Q: What is the BIR doing about unregistered Airbnb properties?
A: The BIR is cracking down on unregistered Airbnb properties by conducting inspections and coordinating with condominium management to identify owners who are operating illegally. They are also reminding property owners that they could face significant fines for non-compliance.
Q: What can happen if I don’t register my Airbnb property?
A: If you don’t register your Airbnb property, you could face fines and other penalties from the BIR and the local government. You may also be subject to legal action and forced to shut down your operations.
Q: Are there any benefits to regulating Airbnb?
A: Yes, there are several benefits. Regulation can help ensure fair competition, improve safety and security for travelers, and generate more tax revenue for the government. It can also help to establish quality standards for Airbnb rentals, which could improve the overall tourism experience in Cebu.
Q: Where can I find more information about Airbnb regulations in Cebu?
A: You can find more information about Airbnb regulations in Cebu by contacting the Department of Tourism (DOT), the Bureau of Internal Revenue (BIR), or your local city hall. You can also consult with a legal professional who specializes in tourism law.
Q: I’m a tourist. How does this affect me?
A: As a tourist, you might see some changes, like slightly higher prices for some Airbnb listings. But you’ll also likely benefit from increased safety and quality standards. Plus, knowing that everyone is operating fairly helps support the local economy.
Time to Act: Support a Fair and Thriving Cebu!
The future of Cebu’s hospitality industry depends on fair competition, safety, and quality. Whether you’re a tourist, a hotel owner, or an Airbnb host, now is the time to support the push for regulation. Tourists, make informed choices and prioritize accommodations that comply with local regulations. Hotel owners, continue to uphold high standards and advocate for a level playing field. Airbnb hosts, embrace compliance and contribute to a sustainable tourism ecosystem. The collective actions will shape a thriving and equitable environment where everyone wins. Consider getting involved with local tourism associations or contacting your local representatives to voice your support for fair regulations that benefit the entire community. Together, we can ensure a vibrant and responsible tourism industry in Cebu for years to come!
