Rhode Island lodging taxes will rise in 2026

Short-term rental (STR) guests in Rhode Island will face higher lodging taxes starting January 1, 2026. Under the latest budget bill passed by the Legislature in June, the statewide local hotel tax rate will increase from 1% to 2%. In addition, lawmakers created a new 5% tax on whole-home STRs.

Currently, lodging taxes on Rhode Island whole-home STRs consist of the state sales tax (7%) and local hotel tax (1%), for a total of 8%. Guests who rent only a room rather than an entire home pay state sales tax (7%), state hotel tax (5%) and local hotel tax (1%), for a total of 13%.

Beginning January 1, 2026, both whole-home and room-only STRs will be subject to a total combined 14% lodging tax rate. While guests pay the taxes, operators are responsible for collecting taxes and remitting them to the state.

The state defines short-term rentals as reservations of 30 days or less, and state-administered sales tax, state hotel tax, or STR tax, plus local hotel tax apply to all STRs in the state. Local tax authorities may also levy and administer their own lodging taxes.

STR operators are required to register with the Rhode Island Division of Taxation to get a sales tax permit, collect lodging taxes from guests, and file lodging tax returns. Returns are due monthly, except for seasonal STR operators, who must file lodging tax returns only for the months they’re in operation and are required to file an annual reconciliation return every year in January.

For operators who use an STR marketplace such as Airbnb or Vrbo that collects guest payments, the marketplace is required to register with the Rhode Island Division of Taxation, collect lodging taxes, and remit them to the state on the owner’s behalf.

In Rhode Island, all charges for occupancy are taxable. This includes items such as cleaning fees, pet fees, rollaway bed fees, extra person fees, etc. Accommodations purchased by buyers including federal or state governments and municipalities may be exempt from short-term lodging taxes.

In Rhode Island, STR owners using STR marketplaces such as Airbnb or Vrbo are required to register with the Rhode Island Department of Business Regulation. Operators must submit the following information with their registration:

• Rental property address
• Property owner/manager’s phone number and email address
• Owner’s principal place of business, or an agent or property manager if the owner is located out of state
• Number of rooms for rent
• Whether the registrant rents or owns
• Intended use (rental of entire space, private room, or shared space)

STR operators in Rhode Island should be aware of local regulations that apply to them, including rules covering permits, licenses, registration, zoning, advertising, neighborhood notification, building and housing standards, and more. Homeowner associations (HOAs), condominium communities, co-ops, and landlords may also have their own specific STR rules.

Avalara MyLodgeTax can help Rhode Island STR hosts automate and simplify city and state lodging tax compliance, from registration to tax return filing. If you have tax questions related to Rhode Island vacation rental properties, drop us a line and we’ll get back to you with answers. See our vacation rental tax guide for more on lodging taxes in the state.