Avalara MyLodgeTax > Blog > State and Local News > Arizona cities increase STR regulations in wake of new state law

Arizona cities increase STR regulations in wake of new state law

  • Nov 29, 2022 | Jennifer Sokolowsky

Scottsdale Arizona STR Short Term Rental

In Arizona, the Scottsdale City Council has passed a new short-term rental (STR) ordinance that requires operators to register with the city. The law also requires vacation rental hosts to carry a minimum amount of liability insurance, notify neighbors that they’re running a short-term rental, conduct sex offender background checks on guests, and observe health and safety rules.

The new licenses are available beginning November 28, 2022, and the ordinance goes into effect on January 8, 2023.

Mesa, Arizona, has also put in place new regulations for short-term rentals that will go into effect February 1, 2023.

Under the law, short-term rental operators are required to obtain a short-term rental license, notify neighbors that the property will be rented out for short terms, provide emergency contact information for someone who can respond to issues with the property, and meet minimum liability insurance requirements. The City Council hasn’t yet determined the amounts for license fees or fines.

The ordinances in Scottsdale and Mesa go into effect shortly before the Super Bowl is played in Glendale on February 12, 2023.

Meanwhile, in Paradise Valley, a new short-term rental ordinance went into effect on November 13, 2022. As in Scottsdale and Mesa, the law requires hosts to obtain a permit from the town to operate a short-term rental and designate a contact for emergencies. Local officials have the power to deny or suspend permits for up to a year for certain code violations, and hosts who break the rules can pay financial penalties of up to $3,500 or the equivalent of three nights’ worth of rent. Background checks are required for both guest and hosts.

The town is waiving short-term rental permit fees from November 13 to December 13, 2022. After that, a vacation rental permit will cost $250.

The STR laws in Scottsdale, Mesa, and Paradise Valley are possible due to a new state law. Arizona state legislation largely prohibits cities, towns, and counties from restricting short-term rentals, but local governments were given some more leeway with a new measure that went into effect in September. The law now allows cities and towns to regulate short-term rentals by:

  • Requiring permits or licenses
  • Requiring community notification of operations
  • Mandating liability insurance coverage
  • Fining owners or management companies when guests violate ordinances

Arizona state law requires short-term rental operators to hold a current state transaction privilege tax (TPT) license. That license number must be included in all ads.

Arizona short-term rental operators are required to collect state transaction privilege tax and county excise tax from their guests and remit it to tax authorities. The state requires all short-term rental online marketplaces, such as Airbnb and Vrbo, to collect and remit state and local taxes on Arizona short-term rentals.

MyLodgeTax can help short-term rental operators in Arizona comply with state and local tax registration, collection, and filing requirements. For more on Arizona lodging taxes, see our state Vacation Rental Tax Guide. If you have tax questions related to vacation rental properties, drop us a line and we’ll get back to you with answers. 

Lodging tax rates, rules, and regulations change frequently. Although we hope you'll find this information helpful, this blog is for informational purposes only and does not provide legal or tax advice.
Avalara Author
Jennifer Sokolowsky
Avalara Author Jennifer Sokolowsky
Jennifer Sokolowsky writes about tax, legal, and tech topics. She has an extensive international background in journalism and marketing, including work with The Seattle Times, The Prague Post, Avvo, and Marriott.
Avalara logo featuring a globe surrounded by colorful lines and swirls

Learn more about AZ lodging tax rules