Quick Answer
Baja California Sur charges a 3% lodging tax (ISH — Impuesto Sobre Hospedaje) on gross rental income for short-term rentals. This is collected from the guest and remitted to the state. Additionally, platforms like Airbnb may withhold Mexico's ISR income tax at a rate of approximately 4% of gross receipts if the host does not provide an RFC (tax ID).
Detailed Answer
Short-term rental operators in Baja California Sur are subject to the ISH (Impuesto Sobre Hospedaje), a 3% lodging tax on gross rental receipts. This tax is collected from the guest — similar to a hotel occupancy tax in the US — and remitted to the state government, typically on a monthly basis. Platforms like Airbnb and VRBO may handle collection and remittance automatically, but hosts should verify their specific platform's compliance in Mexico.
Beyond the ISH, rental hosts must also account for ISR (income tax). Without a Mexican RFC (tax ID), platforms withhold approximately 4% of gross receipts. Hosts who register with an RFC and file monthly or quarterly returns can instead be taxed on net income after deductions — often resulting in a lower effective rate. This is something our team advises every rental buyer to set up before their first guest arrives.
Staying compliant is straightforward with a local accountant who specializes in vacation rental taxation. The total tax burden for a well-structured rental operation in Los Cabos remains very manageable, especially compared to US short-term rental tax regimes. For more details on maximizing your rental returns, explore our FAQ hub or contact us for a property manager referral.