City Approves New Hotel Tax

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Booking a hotel room in Windsor is going to cost a little more money — and hopefully lead to more business.

"We certainly hope so and we certainly expect so," says Christine Melnyk, the Executive Director of Operations for the Sunray Group representing five hotels in Windsor.

City council has approved a 4% municipal accommodation tax that's expected to bring in about $2.8-million a year in additional revenue.

Half of the new dollars will be redirected to Tourism Windsor-Essex Pelee Island, representing a roughly $500,000 increase to the agency's funding from the city. The other half will be in the control of city council with a stated goal of promoting tourism.

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Tourism Windsor-Essex Pelee Island booth at Devonshire Mall. April 2018 (Photo by AM800's Teresinha Medeiros)

Melnyk supports the new tax but was hoping for a little more help from council.

She wanted to see council include some relief of credit card processing fees — which she says will likely go up with the added tax.

"That is a direct hit to us," says Melnyk. "That results, based on the example of $2.8-million, $90,000 annually and that to me should be automatically deducted from the fees that we remit."

The issue over credit card processing fees was the reason councillor Rino Bortolin voted against the tax, which he supported otherwise.

Downtown Windsor Business Improvement Association Chair Larry Horwitz says the hoteliers in the core want to see all of the money generated from the new tax directed to TWEPI instead of half being spent by city council.

"You might say they're not involved in the tourism business," says Horwitz. "They're deciding based on what their constituents feel, they're not based on everyday people that are working in the trenches of the tourism business."

Melnyk says it's the way the industry is trending.

"Because so many other municipalities are doing the same thing as we are, we have to pay and play right? So, we're going to have to participate in order to maintain a competitive edge," says Melnyk.

Municipalities have been able to add the accommodation tax since late April of 2017 after then finance minster Charles Sousa released the 2017-18 provincial budget announcing the new sales tax.