Some of the benefit is certainly from skirting regulations, but I can see some big benefits to accessing a much wider range of options, too, so there might well be a place for AirBnB even if it were taxed/regulated a bit more, rather than simply banned.
That's fine, but it's unproven that the AirBnB market works at all if renters have to pay 20%+ hotel taxes and apartment owners have to pay income tax. It would both raise the effective rates and greatly decrease the received benefit to the seller -- there might not be a clearing market any more. I'd consider renting my spare room for $100 a night, but not for $40.
I doubt it. Landlords have to count rent as aggregate gross income on their tax returns, and it's probably both fairly easy to get caught and fairly serious if you do get caught.
