What Is the Dripping Springs Hotel Occupancy Tax?
The most important regulatory obligation for Dripping Springs STR owners is the local hotel occupancy tax. The City imposes a 7% HOT on all short-term rentals (stays under 30 consecutive days) located in both the city limits and the extraterritorial jurisdiction (ETJ).
Airbnb and Vrbo do NOT remit this tax for you
The City's official guidance explicitly states that reservation services like Airbnb and Vrbo "DO NOT remit HOT to the City of Dripping Springs." As the operator, you are responsible for charging, collecting, and remitting the 7% to the City quarterly.
Combined with the 6% state HOT (which platforms do collect), the total tax burden on a Dripping Springs vacation rental stay is 13%.
| Tax component | Rate | Who collects |
|---|---|---|
| City of Dripping Springs HOT | 7% | You (owner) |
| State of Texas HOT | 6% | Platform (Airbnb/Vrbo) |
| Combined total | 13% | Split responsibility |
HOT Filing Details
Filing frequency
Quarterly
Due date
20 days after end of each quarter (e.g. Q1 due April 20)
Zero-activity periods
A report must be filed every quarter even if the property had no rental revenue
Cleaning fees
Total receipts including cleaning fees are included in the tax calculation
Timely filing discount
A 1% discount may be withheld for timely payments if no delinquent reports exist
Late penalties
5% for 1 to 30 days late, 10% for 31+ days late, plus 10% annual interest beginning 60 days after the due date
Simplify your HOT filing
Many owners use services like Avalara MyLodgeTax to streamline HOT reporting and filing at a reasonable monthly cost. We can point you in the right direction during your consultation.
Upcoming change to watch: Texas HB 2433
Texas House Bill 2433, effective June 1, 2026, is expected to require platforms to collect and remit all state, municipal, and county hotel occupancy taxes. If enacted as planned, this would shift the 7% Dripping Springs HOT collection to platforms, significantly simplifying the process for owners. We are monitoring this closely.
Does Dripping Springs Require an STR Permit?
The City of Dripping Springs has active tools for monitoring STR compliance and enforcing local ordinances, including software that tracks listings, permit numbers, and occupancy. However, the publicly available materials do not spell out a step-by-step permit process comparable to Austin's detailed licensing framework.
What we know with certainty is that HOT registration and quarterly filing is required for all STRs in both the city limits and the ETJ.
Contact the City of Dripping Springs directly to confirm current registration or permit requirements for your property, particularly whether it is in the city limits or the ETJ, as different rules may apply.
How Is Dripping Springs Different From Austin for STR Owners?
| Austin | Dripping Springs | |
|---|---|---|
| STR license or registration required | Yes — detailed licensing framework (Type 1, 2, 3) | HOT registration required; permit framework less publicly documented |
| Platform collects local HOT | Yes, since April 2025 | No. Owner collects and remits quarterly. (May change June 2026 per HB 2433) |
| Combined HOT rate | 17% (11% city/venue + 6% state) | 13% (7% city + 6% state) |
| Platform enforcement deadline | July 1, 2026 — platforms must delist unlicensed properties | Separate from Austin's ordinance |
| Local contact requirement | Yes — must respond within 2 hours | Confirm with City directly |
STR license or registration required
Austin
Yes — detailed licensing framework (Type 1, 2, 3)
Dripping Springs
HOT registration required; permit framework less publicly documented
Platform collects local HOT
Austin
Yes, since April 2025
Dripping Springs
No. Owner collects and remits quarterly. (May change June 2026 per HB 2433)
Combined HOT rate
Austin
17% (11% city/venue + 6% state)
Dripping Springs
13% (7% city + 6% state)
Platform enforcement deadline
Austin
July 1, 2026 — platforms must delist unlicensed properties
Dripping Springs
Separate from Austin's ordinance
Local contact requirement
Austin
Yes — must respond within 2 hours
Dripping Springs
Confirm with City directly
Being a Good Neighbor in Dripping Springs
Beyond formal regulations, successful STR operations in Dripping Springs depend on being a responsible member of the community. This is especially true for large-group properties, which are common given the area's wedding and event circuit.
Safety monitoring
Equip your property with smoke detectors, carbon monoxide detectors, and fire extinguishers. This is both best practice and consistent with standard building and fire codes.
Noise monitoring
Noise monitoring devices can catch problems early and protect the property, neighbors, and the owner's long-term rental viability.
Guest screening and clear house rules
Especially important for large group bookings, which are common in Dripping Springs. Clear rules upfront prevent the vast majority of issues.
Respect the Dark Sky community
Dripping Springs is a certified International Dark Sky Community. Outdoor lighting should be fully shielded and designed to minimize light pollution.
How Does Co-Hosting Help With Dripping Springs Compliance?
Between HOT registration, quarterly tax filing, safety best practices, noise monitoring, and staying current on any local regulation changes, Dripping Springs STR compliance has real operational overhead, especially for owners who do not live locally.
We live in the Dripping Springs area and stay on top of local regulations. We can guide you through every compliance requirement and help connect you with the right resources for tax filing and reporting.
Book a free consultation