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Rhode Island Clarifies Tax on Short-Term Campground Rentals

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Rhode Island’s Division of Taxation has confirmed in Notice 2025-04 that campground stays shorter than 30 consecutive nights are subject to the state’s hotel and sales tax, bringing outdoor hospitality businesses under the same rules that already apply to hotels and other short-term rentals.

Issued July 25 and posted July 31, the notice makes clear that the 6% hotel tax and 7% sales tax apply when a campground provides the lodging unit itself—whether that unit is a tent platform, cabin, or cottage. Campgrounds run by exempt organizations remain untaxed, and sites where guests supply their own tent or recreational vehicle are also excluded.

For operators, the clarification removes any doubt about whether short-term campground income should be taxed—and raises immediate questions about compliance.

The bulletin spells out which bookings are taxable, but not how to apply the rule in daily operations.

A step-by-step approach is considered a best practice: first, map every rentable site and tag those stays under 30 nights as taxable; then add a dedicated “Rhode Island Hotel & Sales Tax” line in the property-management system to prevent staff overrides; display the required registration number in every short-term rental listing on hosting platforms; create a monthly filing calendar with dual sign-offs; train front-desk staff to disclose the tax up front; keep occupancy reports and exemption certificates for at least three years as a recommended guideline; and run an annual self-audit to catch errors before the state does.

Consistent labeling of the tax line is important, as some reservation platforms may default to “sales tax,” which can be mistakenly deleted during rate changes.

Separately, state law requires every short-term rental—campgrounds included—to register online with the Department of Business Regulation. Failure to do so can trigger fines ranging from $250 to $1,000, according to the state portal. Once issued, the DBR registration number and its expiration date must appear in every short-term rental listing on hosting platforms.

Operators that list inventory on Airbnb, Vrbo, or similar sites face another layer of oversight. Under amendments that took effect January 30, hosting platforms must display valid registration numbers, collect and remit the tax, file quarterly reports, and remove unregistered listings within 14 days of notice or pay $250 per day per listing, according to an industry advisory.

Campgrounds worried about sticker shock can blunt the impact with several guest-facing tactics.

Bundling small perks such as Wi-Fi or a bundle of firewood can offset the added tax; dynamic pricing tools can trim base rates during slow periods; pre-arrival messages that explain the mandatory tax reduce negative reviews; and marketing materials can highlight parity with nearby Massachusetts and Connecticut parks.

Because the notice is framed as a clarification of existing law, it is presumed effective as of its issuance date in the absence of an announced delayed effective date, and campground owners are urged to verify tax settings before the Labor Day rush.

A quick internal audit each quarter, based on the workflow above, can help ensure the correct amounts are being collected and remitted on time.

By extending hotel-style taxation to tents and cabins, Rhode Island has created a more uniform framework for every type of short-term lodging.

Operators will be watching both the upcoming Narragansett court decision and any further advisories from the Division of Taxation to see how the regulatory landscape continues to evolve.

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Hi, you might find this article from Modern Campground interesting: Rhode Island Clarifies Tax on Short-Term Campground Rentals! This is the link: https://moderncampground.com/rhode-island-clarifies-tax-on-short-term-campground-rentals/