BUDGET: People in the UK who let out their homes on Airbnb got a £1,000 tax break
From April 2017, homeowners in the UK that let out their properties on Airbnb won't need to declare or pay tax on the first £1,000 they earn on the platform per year.
The same goes for anyone else that offers a service or product on a different sharing economy platform.
"We're going to help the new world of micro-entrepreneurs who sell services online or rent out their homes through the internet," said Osborne in his annual Budget speech at the House of Commons.
"Our tax system should be helping these people so I'm introducing two new tax-free allowances each worth £1,000 a year, for both trading and property income. There will be no forms to fill in, no tax to pay - it's a tax break for the digital age and at least half a million people will benefit."
Both tax breaks are expected to cost a total of £235 million a year by 2018, according to The Guardian.
Osborne announced separate plans in July 2015 to increase tax free earnings to £7,500 for Airbnb hosts who qualify for rent-a-room tax relief. This policy comes into effect next month.
Airbnb published a blog post in response to the Budget saying it was "good news for the growing number of Airbnb hosts in the UK."
The San Francisco-headquartered company said: "The UK has set itself as a global leader for the sharing economy and is introducing progressive new rules that empower regular people and promote innovation through technology. We applaud the government for supporting hosts and progressive business models across the country; their leadership on this important issue is an example to the world."
Trade body Sharing Economy UK also welcomed the news, having previously championed such tax breaks.
"This is a colossal win for Britain," said Debbie Wosskow, founding chair of Sharing Economy UK and founder of Love Home Swap. "Consumers need to be able to use sharing economy platforms such as Airbnb and TaskRabbit to top up their income without the fear that they are breaking the rules."
Wosskow also highlighted how 65% of those participating in the sharing economy are female. "This move brings us a step closer to empowering these women and other micro-entrepreneurs to live and work in a flexible way," she said.
Jean-Michel Petit, cofounder of social dining site, Vizeat.com, which allows travellers to experience authentic dining experience with locals, said it's "heartening" to see the UK government "finally" acknowledging the significance of the sharing economy. "It's an industry currently worth £15 billion in the UK," said Petit. "This is a long overdue step in the right direction. The sharing economy will expand significantly over the next coming years, bolstering the UK economy."
The tax cut for Airbnb users comes as Osborne looks to clamp down on buy-to-let landlords, prompting criticism from some Twitter users, including Alex Hern, a technology reporter at The Guardian.