Councillors have said yes to municipal accommodation tax in principle, with details still to be decided.
A committee of councillors and stakeholders is to be struck to look at some of the issues the tax presents, and to report back to council for a decision.
Some of the details to be finalized are significant, including whether the tax would apply to all sectors of the accommodation industry in Niagara-on-the-Lake. Lord Mayor Betty Disero asked that bed and breakfasts and cottages with three or four rooms be exempt, at least for the first year, while Coun. Clare Cameron suggested everyone in the industry, regardless of the size, should be treated the same, in the interest of fairness.
Also discussed was whether the tax should be a percentage — four per cent was the figure used — or whether it should be a flat rate.
The flat rate would be easier to administer, but a committee which had met to discuss the tax, including representatives of the accommodation sector from small-scale rentals and hotels, could not reach a consensus.
The committee was also “not able to come to a consensus as to whether the MAT is the best tool to support a destination marketing program,” the report said.
There are 32 municipalities in Ontario who take advantage of the ability to collect a tax from tourists, to help pay for infrastructure for tourism, councillors were told, and who could provide information on its impact on tourism.
A “tourism entity” would be required to partner with the Town, to receive a percentage of the revenue generated by the tax, and could be the NOTL Chamber of Commerce, although that has not yet been decided.
“The MAT funding could be used to either supplement or replace the existing funding model between the Niagara-on-the-Lake Chamber of Commerce and the Town,” the report said, referring to the $118,000 the Town pays the Chamber in fees for services the Chamber provides to the Town.
Lord Mayor Betty Disero told councillors she supports the tax in principle, that 18,000 residents cannot continue to fund the infrastructure and maintenance required to provide for almost 3 million tourists who come each year.