Lawmakers speed tax bill with eye on US Open

Confusion over a sales tax issue could have affected those renting houses during the U.S. Open golf tournament in Pinehurst. A fix that cleared committee Wednesday would make clear those who rent houses for less than 15 days through a real estate broker must pay sales tax.

Posted 10:43 p.m. May 21, 2014 — Updated 3:34 a.m. May 22, 2014

Mark Binker

RALEIGH, N.C. — Lawmakers are driving to make sure a bill dealing with sales tax on short-term house rentals gets through the General Assembly in time to take effect for this summer's U.S. Open in Pinehurst.

"We do have a time-sensitive issue," Rep. Julia Howard, R-Davie, told the House Finance Committee Wednesday night.

For nearly 30 years starting in 1984, state law said that someone who rents a private house for fewer than 15 days doesn't have to pay sales tax, unless that house was listed through a broker of some kind. In that case, sales tax applied.

In 2012, the Department of Revenue issued a bulletin changing that interpretation, saying that counties could not collect sales tax in either case, according to a summary of the bill.

Howard said the department "had no authority" to issue that interpretation. Her bill, she said, "does nothing but correct an error by the Department of Revenue."

Although the Howard bill applies across the state, it is moving quickly because of this summer's U.S. Open. Many golfers and golf fans will be renting houses in Moore County because there are not a lot of hotels near the golf course.

A similar provision is in a tax measure that passed the state House Wednesday, but there are concerns that measure could move more slowly than is needed in order to put the rental tax measure in place in time for the golf tournament.

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