City eyes mandatory 4% hotel tax
Newstalk 580 CFRA
Published Wednesday, November 29, 2017 3:59PM EST
Last Updated Wednesday, November 29, 2017 6:55PM EST
Visitors to Ottawa will soon have to pay a four per cent tax to stay in a hotel.
A report for the Finance and Economic Development Committee outlines a plan to impose a four per cent Municipal Accommodation Tax on overnight stays in Ottawa.
Ontario has passed legislation giving municipalities the power to implement a Municipal Accommodation Tax, which would apply to hotels, motels, bed & breakfasts, and accommodators with a roof renting consecutive room nights of under 30 days.
Revenue raised by the Municipal Accommodation Tax will support the local non-profit tourism entity.
The Ottawa Gatineau Hotel Association currently has a voluntary three-per cent room-night levy on hotel rooms in the region. It has raised approximately $8 million to $9 million annually in support of destination marketing for Ottawa-Gatineau. The voluntary levy is applied only to the room portion of guest services.
Staff say both the Ottawa Gatineau Hotel Association and Ottawa Tourism support the mandatory four per cent Municipal Accommodation Tax, since it would provide additional capacity to the local tourism sector to attract more events and conventions.
If the new four per cent Municipal Accommodation Tax is approved, it will be implemented on January 1, 2018.
The report also says the city will seek to enter into collection agreements with platforms AirBNB and HomeAway.