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County proposes Municipal Accommodation Tax

County staff are recommending the municipality implement a mandatory 4 per cent Municipal Accommodation Tax (MAT).

The MAT would apply to all roofed accommodations provided for a continuous period of 30 days or less. The tax would apply only to the accommodation fee.

“A MAT would support the services and resources that thousands of visitors access when they come to the County,” says Todd Davis, Acting Director of Community Development and Strategic Initiatives. “Furthermore, a MAT would help grow our investment in the tourism industry – a vital part of the local economy – without increasing taxes for local residents.”

Visitors who stay at motels, hotels, inns, bed and breakfast establishments, and private, short-term accommodation (STA) rentals would pay the tax. The tax would be added to guest invoices, and accommodators would be required to remit the MAT to the municipality.

“A MAT of 4 per cent is consistent with neighbouring cities and regions and is the industry standard across the province,” Davis says. “Staff believe that 4 per cent is a reasonable rate and will not impact consumer behaviour in any significant way.”

The provincial government in 2017 gave municipalities the authority to impose a tax on transient accommodations. Under the legislation, 50 per cent of MAT funds must be used by the municipality for infrastructure or services that support tourism. The remaining 50 per cent is to be used by an eligible tourism entity to support tourism promotion and development.

Staff proposes a phased approach to implementing a MAT. During the first phase, it is recommended the municipality begin collecting the tax as of June 1, 2020. During the second phase, staff would undertake public and industry consultation in order to inform recommendations to bring to council regarding how MAT funds should be spent.

The MAT proposal is the subject of a special Committee of the Whole meeting on Thursday, Feb. 27 at Shire Hall, Picton, beginning at 7 pm.

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  1. Dennis Fox says:

    A friend owned a vacation rental home for several years, then decided to retire to the County and live in their vacation home – and did so for a number of years. During the STA debate period they decided to move back closer to their kids. But just to cover their future, they decided to buy a STA permit – other than the expense it was pretty straight forward. They contacted a real estate agent for an evaluation of their home. Right off the top the agent told them to ADD $50,000 just for the permit – outside buyers will find that a big plus!

    So for those who are complaining about a bit of paperwork (and that is all it is – a bit!) – why do you believe our entire community should be over-run with tourists, have locals pay for the over-used roads, crowded hospital and shown no sense of community during their visits? Pay up and be happy. Whatever they are charging for a permit, isn’t enough.

  2. Chris Keen says:

    “Wineries , Restaurants, bars, recreational activities , novelty stores etc…” are not included in the because they are not offering accommodation and thus were not included in the Municipal Accommodation Tax regulations by the province.

  3. Traditional B&B Owner says:

    First the licensing and fee per room now they want us to collect a tax .. we have operated a Traditional BNB for 13 yrs in our primary residence we live in County we do not own a house and rent it out as a vacation rental and live in Toronto we were born in the County and our ancestors go back as far as the Empire Loyalist .Traditional bnb’s should not have been included with the STA ‘s in the first place we contribute to the County economy daily as we live there all year not just in the Summer
    It seems that the BNB owners are the only ones that are being hit with all these new rules and regulations & taxes we are not the only ones that may be benefiting from the Tourist why are the Wineries , Restaurants, bars, recreational activities , novelty stores etc also not included in this Tourist Tax only Accommodation owners Lighten up on the bnb owners or there won’t be any place for these Tourist to stay you are driving us out of business
    Are we going to be compensated by the County for collecting this tax for the County no one works for nothing and this seems be creating a lot of book work to collect and submit on a regular basis and not to mention the cost of accounting fees to do this it seems the county want us to do it for nothing like its a privilege for us to do this I don’t think so
    Go back to the drawing Board and include all businesses not just accommodation every business benefiting from Tourist should have to collect this Tax if it is implemented

  4. Steve says:

    I also would like to know if a list of approved STA will be available. From what I see and hear , many operators are preparing to ignore the registration until found out.
    Will the county cross reference the advertised sites with the registered properties?
    Owners are using the relative and cousins approach to avoid the tax, payment by cash or checque only.
    How will this be addressed?

  5. JB says:

    This tax is great. It’ll allow the County to finally get some direct tax revenues into County coffers, even if it supports tourism related matters. Additionally, it links County revenue to STA income, encouraging the County to have a healthy STA community.

  6. olmnonthemtn says:

    The following is an excerpt from the Ontario regulation regarding the Transient Accommodation Tax upon which municipal accommodation tax is based:
    “For each full or partial fiscal year of the municipality that the tax is in effect, the municipality shall make one or more payments to the eligible tourism entity that received revenue, directly or indirectly, from providers of transient accommodation in the municipality under a destination marketing program that existed immediately before the tax came into effect, the total of which must be at least equal to the amount determined under this section.”
    It seems folks the revenue is not to be used for general revenue/expenditure but must be redirected to a an “eligible tourist entity”

  7. SS says:

    My 0.02 worth — it is well past time for this — it is very common practice for tourist destinations. In a worst case scenario for a visitor — for a 30 day stay at $150 per day, this amounts to $180. Hardly enough to change a visitor’s mind.

    If a landlord advises their prospective tenants immediately now of this new policy, the tenant can certainly change their mind — but likely won’t. And if they do, the landlord will then have free space in time to get a replacement booking, because it’s still very early in the year.

  8. Angela says:

    Geese reliably do something else besides laying golden eggs ADJ and some of it has been deposited here. Drunken parties with vacationers relieving themselves on front lawns has been reported along with bonfires that endanger nearby barns. Sad that we supposedly depend on some of these visitors to keep the economy rolling. We should at least see some tax revenue to compensate for the negative side of vacation rentals. If we are to keep the permanent residents who are the real heart of this county maybe we should give some thought to a little tax relief. If the MAT tax can help it should be implemented.

  9. Dennis Fox says:

    Well step back and ask yourself what kind of notice are you given when your taxes go up? None. In our case here in PEC, over the last two years we have experienced an 8.5% and this year a 4.6% tax increase – no notice, no time to adjust – I think this argument of showing concern for the impact on the poor tourists is very much over-blown.

  10. Gary says:

    No grace period. Costs change all the time. Curious, can a resident check a municipal list to see if their neighbour has registered as an STA ?

  11. SAB says:

    I am sure anyone who has rented a place have also signed a contract….which I hope would be legally binding

  12. ADJ says:

    How does the municipality know how many rentals are made? The owner/operator can record or Not their clientele. Cash is best and no paper trail!
    Do you actually believe all operators are going to follow this popped up rule?
    “The cost of doing business” should also include HST.(on everything) Carbon Tax, property tax, along with this MAT tax. What else am I forgetting?
    I was told by a reliable visitor to that Niagara region that when he questioned this new MAT tax the owner operator quickly told him to ignore it. He just wanted an explanation and then he paid it no problem.
    I predict if this 4% is brought in it will balloon to 10% in a few years.
    You want tourist to keep this County economy rolling keep up with these schemes to kill the goose.
    I would suggest billing the County for bookkeeping and tax collecting services. This has nothing to do with a grocery rate increase or a fuel increase….these are considered basic necessary items. A case of beer is not but you still pay hst on it.

  13. Angela says:

    The guests have lots to spend so an extra 4 percent is not going to stampede them or blow the budget on their holiday plans. We are not warned ahead about price increases at the grocery store or the gas pumps. New charges are introduced on a wide variety of things all the time without a year’s notice. This tax is overdue.

  14. SAB says:

    When people are paying 5000.00 a week, I am sure the homeowner has calculated this tax which was discussed by council and homeowners last year

  15. Dave says:

    Visitors will NOT accept a price increase after they have made the purchase. Saying that they have a lot of money anyway and so they will just pay it is not responsible

  16. Allie says:

    In that case most municipalities which implemented a tax provided a “grace” period in their by-laws. If you booked your trip prior to X date, then the tax wouldnt be charged.

  17. Dennis Fox says:

    The tax is only 4%. Even if the accommodation bill was for $1000, the tax would only be $40 – hardly enough to cause hardship for a vacationer. About the same amount for a case of 24 beers. Think of the benefit it would have for this community when multiplying this 4% by the many thousands of visitors we get.

    The real problem is the owner of these rental places – they have gotten use to doing nothing other than collecting the money, now they have to keep track of the number of guests and pass on the tax to the municipality – but again it is well worth the trouble considering the profits they make. It is called the cost of doing business.

  18. Jimmy says:

    I agree. While the tax makes sense, the last minute timing doesn’t. It should not apply until 2021 to allow time for guests to know about the tax and have agreed to it upon booking.

  19. Dennis Fox says:

    No, the owner will advise the people that a new tax came into being – much the same as we all pay when the price of gas jumps during the vacation season or the cost of alcohol when the government raises the price on it. This is not a big deal for anyone. A 4% increase is not huge nor problematic – particularly when you are talking about tourists who are prepared to spend to have a good time.

  20. Dave says:

    ok, but the problem is many visitors have already booked places for the summer and haven’t added this 4% to the cost. People renting houses can’t go back to them now and demand an additional tax that was undisclosed when they did the reservation.

    So the owner of the property has to eat this cost?

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