Guelph will be joining numerous cities across the province that have implemented a municipal accommodation tax.
This means overnight stays in Guelph will cost you a few extra bucks to help local tourism.
“Visitors would see an additional $4 to $7 added to their bill per night. The implementation of MAT will generate about half $500,000 to $1,850,000 in revenue annually through hotels and motels. In addition, short-term rentals Airbnb will generate an approximate $100,000 annually,” said Cathy Masterson, manager tourism and destination development. She added that the tax is not applicable to other accommodation charges like food or parking.
“This program will support the stabilization of the tourism ecosystem. It will provide funding to rebuild the tourism industry and invest directly back into growing and strengthening Guelph as a destination. This program will also increase the investment in tourism infrastructure that supports new and enhanced visitor services and programs.”
Provincial Bill 127, passed in May 2017 allows municipalities to implement a tax on short-term stays to improve and enrich tourism experiences.
On Monday’s committee of the whole meeting, with an 11-1 vote, city council passed a motion with the recommendation that a four per cent Municipal Accommodation Tax be approved, that staff be directed to negotiate and execute a five-year agreement, subject to the satisfaction and authority of the city solicitor, the deputy chief administrative officer of infrastructure, development and enterprise, the Guelph Chamber of Commerce (the Tourism Entity) for the purpose of implementing a Municipal Accommodation Tax.
2. That Appendix A of the General Reserve and Reserve Fund Policy be amended to reflect the creation of a Tourism Municipal Accommodation Tax Reserve (184) with the terms and authority as identified in the 2022- 09 Municipal Accommodation Tax report, dated February 7, 2022.
3. That the Tourism Municipal Accommodation Tax Reserve be approved to be over-drawn up to a maximum of $1 million.
The tax will come into effect by Sept. 1.
“We'd like to recognize that this has been an intensely difficult time for this industry. As the waves of opening and closing restrictions have had a significant effect on how these businesses have provided their services. This creative sector has pivoted multiple times and shifted where possible to a digital platform and has generously shared their skills and performances with people at home and abroad,” said Jayne Holmes, deputy chief administrative officer, infrastructure, development and enterprise services.
“The acceptance of this program will set the stage to direct the efforts of the tourism division to establish a framework to support the future functions of the economic development within the tourism industry. It is important to recognize the role of tourism in our local economy.”
However, Airbnb does not seem thrilled with the idea of the tax.
A letter by Airbnb addressed to the council and the mayor in last December stated that current Municipal Accommodation Tax (MAT) systems do not work for a global platform like Airbnb, and recommended the city to reach out to the Ministry of Finance and Tourism to create a province-wide system for all municipalities to adhere to.
“With over 400 municipalities in the province, platforms like ours are being asked to enter into hundreds of individual MAT collection agreements across the province. While we support collecting an accommodation tax and stand behind the communities and tourism development of the municipalities where we operate, the current system is cumbersome for most municipalities to individually implement,” said the letter.
