Nova Scotia offers tax relief to hotel operators

Nova Scotia has announced a new program aimed at assisting hotel, motel and inn operators in the province with property tax bills during the COVID-19 pandemic.

The province’s ‘Tourism Accommodations Real Property Tax Rebate Program’ will provide qualified operators a 25 per cent rebate on payment of 2020-21 commercial property tax.

"We know that hotels, motels and inns have immediate cash flow needs because of the decline in visitors due to COVID-19," said Minister of Business Geoff MacLellan in a statement. "They are facing commercial tax bills assessed on the previous year's revenues with a significantly reduced ability to pay. This is another in our range of response programs designed to fill gaps in federal programing."

Megan Delaney, the president of Hotel Association of Nova Scotia, said the cash flow problems were real.

"Even though we weren't forced to be closed, we were essentially empty," Delaney said.

Ron Miller, of Best Western, says fixed costs are the biggest problem.

"Light and utility bills and taxes don’t go away just because guests do," he said.

The province says Nova Scotia’s tourism industry is expected to generate $900-million in 2020 -- nearly a third of the almost $2.7 billion last year.

"This is a great first step, however we need to keep discussions open," Delaney said. "The hotels need relief that will not only sustain us now, but that will work towards the regeneration of our industry in the future."

To be eligible, a business must meet the definition of a roofed accommodation as set out in the Tourist Accommodation Registration Act, be registered as a host under the act, have more than five rooms and have paid their tax bill in full. 

Qualified operators must show they have incurred a year-over-year revenue loss for room accommodation of greater than 30 per cent from April 1 to Oct. 31, compared to same period the previous year.

New operators who were not in business before April 1 may still be entitled to a rebate if they can demonstrate lower than 50 per cent occupancy rate since opening their business. 

Operators can begin applying to the program on Nov. 16. 

MacLellan believes the relief will help, but admits it won’t necessarily save jobs.

"Twenty-five per cent of property tax isn’t going to be that magic policy wand that fixes everything," he said.

Still, the opposition is pleased relief has arrived, even though they say it should've happened sooner.

It previously pitched the idea of a $200 credit to inspire Nova Scotians to staycation in their own backyard.

"In Nova Scotia, the premier wasn’t interested in that, they didn’t do it," said Progressive Conservative leader Tim Houston. "In New Brunswick, they did it and I think it was very very successful."