B. AT THE LOCAL LEVEL: THE EXAMPLE OF THE PROACTIVE POLICY OF SAN FRANCISCO
The Federal System of the United States gives great importance to local authorities, particularly in the area of taxation both in determining the tax base and the rate and with respect to tax procedures. Several U.S. cities therefore have a proactive policy regarding income tax on income derived from online platforms.
The initiatives of the City of San Francisco are the most significant , not only because of their magnitude but also because they originate in the very place where the companies concerned were founded.
1. Hoteltax collection and automatic reporting
In San Francisco, the equivalent of the touristtax, the hotel tax , is set at 14% of the price of each room , whether it is a hotel room or a furnished tourist rental: it is therefore an important financial consideration for this city, which is also one of the top tourist destinations in the United States, and where the price of real estate is the highest 94 ( * ) .
The tax can be collected either by the renter, or through the transaction operator , which can be a traditional agency or an online platform : we are agnostic on this point, regardless of who collects the tax, provided it is paid , said the Tax Collector of the City and County of San Francisco 95 ( * ) , David Augustine.
The system, in principle, is voluntary for the renters. However, as a qualified company, Airbnb collects the tax systematically, for all its hosts in San Francisco : the system is automated and is not subject to choice on a case by case basis.
Most importantly, in San Francisco, collection of the hotel tax by intermediaries is accompanied by the transmission of all relevant information: price per night, exact address of the accommodation, name of the owner, etc .
Therefore, the City Hall services know the income for each host , while this is not the case for the IRS (see above). For the platforms that do not collect the tax themselves (for example Craigslist , the U.S. equivalent of Leboncoin ), the City Hall can use its communication right under ordinary law 96 ( * ) . Do the platforms respond? This information is covered by tax secrecy, but we use all the legal means at our disposal , according to David Augustine.
Overall, collection of the hotel tax by the platforms in San Francisco is a clear success . The revenue from the hotel tax total approximately $300 million per year, a significant contribution to the budget of the city of San Francisco, which is $8 billion 97 ( * ) . Of this $300 million, Airbnb collects approximately a million dollars per month , a figure covered by tax secrecy that the City Hall cannot confirm.
The City Hall of San Francisco believes that the success of this system is due to the strict separation which exists between the collection of the tax and the other public policies . David Augustine thus stated: My work, is to collect taxes and nothing else. We do not deal with other applicable regulations, housing registration, fire standards etc. The most significant reflection of this policy is that the data collected by the City tax department are in no case shared with other departments of the City and County and, in particular, to the Planning Department , responsible for the urban planning policy and therefore for the control of the upper limit of nights applicable to the rental of each housing unit. Neither are they sent to the Internal Revenue Service .
2. A proactive use of the communication right?
A lot can also be learned from the action of San Francisco City and County with respect to online mobility platforms.
In April 2016, the Treasurer of the city, José Cisneros, sent some 37,000 Uber and Lyft drivers of San Francisco a letter ordering them to obtain a professional licence to carry out their activity, and to pay taxes for which they are liable as self-employed workers . This licence costs 91 dollars per year for self-employed workers whose turnover is less than $100,000 per year. The letter stated that drivers not complying with this obligation, which has existed for a long time, would be liable to penalties. The single procedure of registering 37,000 additional self-employed workers would constitute additional revenue of $3.4 million for the municipality even if an unknown number of drivers already have this licence. In three weeks, 8,000 drivers responded to the City Halls 98 ( * ) order .
This policy forms part of the debate on the legal status of Uber and Lyft drivers, as noted by the San Francisco Chronicle : When faced with class-action lawsuits from drivers seeking status as employees, the companies have vigorously maintained that the drivers are independent contractors. Cisneros is in essence turning that argument back on them and saying: If thats the case, the drivers have to register as independent contractors for a business license 99 ( * ) .
The City of San Francisco was unable to confirm the source of the list of the names and addresses of the drivers, covered by tax secrecy. However, it is likely that the list comes from the use of a communication right with regard to Uber and Lyft 100 ( * ) . As a reminder, in a report of 12 April 2016, Uber revealed that it had replied, over the previous six months, to more than 12 million requests for information from the administrative authorities (the federal authorities, but also, among others, California, New York and Chicago), regarding its drivers and its customers.
It should however be noted that this offensive use of the communication right is not without its detractors in the municipal administration of San Francisco: the registration of self-employed drivers is an initiative of the City Treasurer, José Cisneros, an elected official who is totally independent from the Mayor 101 ( * ) . The latter, Ed Lee, has moreover stated that he is neither for nor against this initiative.
* 94 In San Francisco, a highly-qualified employee may spend up to 75% of his income in rent, and Silicon Valley as a whole lost nearly 6,000 inhabitants last year due to the increase in the price of housing. Thus, in order to encourage social mixing, the municipality of Palo Alto has even considered granting housing benefit to households with an annual income of less than250,000 dollars per year.
* 95 The Tax Collector is the senior official in charge of taxation in the City and County of San Francisco. He is placed under the direct and exclusive authority of the City Treasurer, José Cisneros (see below).
* 96 This communication right is similar to that available to the General Directorate of Public Finances (see above), and allows non-nominative requests to be made.
* 97 There is in addition, in particular, $1.4 billion in property tax , at the rate of 1.1%, based on the value of the propertywhen it was acquired. Given the considerable increase in property prices in San Francisco, this rule leads to large inequalities. As in France, a revision of leasehold valuesis currently being debated (" proposal 13 "), but will probably initially be limited to commercial premises.
* 98 Source: San Francisco City Hall, 6 June 2016.
* 99 Source: San Francisco Chronicle , San Francisco to require Lyft and Uber drivers to obtain a license , 15 April 2016. http://www.sfchronicle.com/bayarea/article/SF-to-require-Lyft-Uber-drivers-to-obtain-7250137.php
* 100 Unlike the communication right exercised by the DGFiP, the communication right of the City Hall of San Francisco does not come up against the obstacle of territoriality: Uber and Lyft are established in the United Statesjust a few streets away from San Francisco City Hall.
* 101 And the same applies to the sheriff and the district attorney , for example. These elected officials have their own administrative authority and are directly accountable to their constituents.