San Antonio’s tougher short-term rental rules and a new tax deal with booking platforms have turned into real money for City Hall. In fiscal 2025, hotel-occupancy taxes from short-term rentals jumped to roughly $9.6 million, a surge city officials are tracing directly to policy changes and stepped-up enforcement. The cash arrives just as council members wrestle with budget gaps and debate what to do about property taxes.
According to the City of San Antonio FY2025 STR annual report, short-term rental hotel-occupancy tax collections hit $9,572,089 in FY2025, about a 72% increase over FY2024. The report lists 3,339 active STR permits across the city and details thousands of enforcement actions, including 2,739 permits revoked since the ordinance went into effect. Development Services also reported more than $2 million brought in through enforcement efforts, showing the new rules are generating revenue on top of what platforms are sending in.
The spike followed a 2024 rewrite of the STR ordinance and a shift by major listing platforms to automatically collect local taxes, as reported by the San Antonio Express-News. Council members previously voted to raise permit fees and stiffen penalties, effectively setting the table for those platform remittances to start flowing into city accounts.
Platforms now remit the city's share
City staff have been blunt with hosts about what changed. “Platforms that collect TX state tax will now also collect San Antonio city tax effective with February taxes due in March 2025,” the city explained during a recent platform-deductions webinar. The session also walks hosts through a new online filing form that automatically deducts what platforms have already collected and calculates what owners still owe for county and other taxes, according to the City of San Antonio Development Services presentation.
Audit flagged enforcement gaps
An audit reviewed by the San Antonio Express-News found that Development Services had not been reliably identifying properties that should fall under STR rules. In a 20-property sample, auditors determined that at least 16 permits should have been revoked because required notice letters were never sent. The review also reported that the city was not verifying whether operators’ reported revenues lined up with available records and that collection contractor Avenu had failed to mail some notice letters at all, prompting council members to push staff to chase down delinquent taxes more aggressively.
Why it matters to the budget
Even with the STR windfall, the city’s financial picture is far from rosy. Staff presented a five-year forecast showing a nearly $131 million general-fund shortfall that will force budget cuts or a property tax rate hike unless other revenues pick up. As KSAT reported, higher STR collections are a helpful boost but not anywhere close to a full fix.
City officials and auditors say the combination of automatic platform remittances and tougher enforcement is a solid start, but tracking down unpermitted operators and back taxes remains a work in progress. For now, the $9.6 million gives City Hall a bit of breathing room while leaders debate whether to trim services, hunt for new revenue, or a mix of both.
