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Airbnb To Pay Millions Of Dollars In Back Taxes To San Francisco

SAN FRANCISCO (CBS SF) -- The short-term housing rental service Airbnb has agreed to pay back taxes owed to San Francisco that were estimated to be millions of dollars.

In a statement issued on Wednesday, the San Francisco-based internet company that lets people rent rooms or houses to travelers said that it has "paid in full" a back-tax bill.

The San Francisco's Chronicle's Matier and Ross column reported that Airbnb owed the city an estimated $25 million. A company spokesman, however, wouldn't say how much the company paid.

City Treasurer Jose Cisneros ruled in 2012 that Airbnb owed back-taxes. He also declined to reveal how much money was collected from Airbnb, citing a local law that mandates confidentiality on all tax matters.

Airbnb's reluctance to pay the city's 14 percent hotel tax was a major sticking point in legislation passed in 2014 by the supervisors that legalized short-term home rentals. While, the law mandated that Airbnb pay the city's hotel tax going forward, there was no mention on what it had already owed.

The announcement was welcome news for San Francisco Mayor Ed Lee who is running for re-election in November.

"This will mean millions of dollars today and going forward in revenue for the city to fund affordable housing, public safety and other vital city services," he told the Chronicle.

Supervisor David Campos, who has been a loud critic of the company citing its unfairness and its impact on the reduction of housing stock, called the announcement a "victory."

"We are glad they did this, but I don't know if congratulations are in order for someone who paid their taxes three years late," Campos said.

The settlement could set a precedent nationwide for Airbnb, which is facing growing pressure from other cities.

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