"Hotel Tax" Idea Being Studied Closely This Fall
The controversial idea of a "hotel tax" is being studied closely by communities here in Renfrew County this fall.
The Ottawa Valley Tourist Association wants municipalities to adopt a 4 per cent "Municipal Accommodation Tax" (MAT), similar to what you see charged on your hotel bill in larger communities, to be charged by local accomodators in the tourism industry.
Under the propsal, the OVTA, as an eligible tourism marketing entity, would get half of the revenue for tourism marketing - which it figures would be roughly $700,000 a year if all Renfrew County Municipalities adopted such a tax.
Municipalities themselves would get the other half.
OVTA president Chris Melmoth appeared at Petawawa Town Council to explain the tax on Monday night.
Melmoth says there's tremendous potential to take marketing the Valley's tourism industry to the next level, and giving the region an even better shot at drawing in more visitors to support the tourism sector and the broader local economy.
"This cluster effect of marketing Renfrew County and the area, that's where we stand to benefit the most", Melmoth told reporters outside of Town Hall after his presentation.
"The smaller tourism operators could benefit from that cluster, from that group marketing, where they could draw from a larger market", he added.
Opposition & Concerns
Melmoth acknowledges there's been some opposition by the tourism industry to the idea.
Some hotel operators have said they can't support a move that would see them charging customers more, noting that many visitors have sensitive tourism budgets for their travels, and that existing tourism dollars are too precious to risk.
Petawawa Town Councillors also raised concerns at Monday night's meeting.
Many councillors said they understood the potential that the tax could bring, both for tourism marketing, and for municpalities as a new revenue source, but questioned whether it would be perceived as having any value by those who pay it.
"This is kind of like a luxury tax", noted Coun. James Carmody.
"What are users getting in return?" he asked.
Deputy Mayor Gary Serviss raised concerns about whether this would be a tax that users would be blindsided with when they checked out of their hotel, or whether it would be transparent in up-front costs.
Melmoth acknowledged all of the concerns raised around the Council table, saying this is a tax that is now enshrined in provincial legislation and therefore must be transparent in estimates that include tax.
He also noted that return visitors would benefit the most if the municipalities and OVTA were using the revenue to improve tourist draws and other features that tourists enjoy within the host communities.
Melmoth said municipalities and accommodators would have a say in deciding how the marketing dollars raised through the tax were spent, and that dollars collected in Petawawa, for example, would be dedicated by the OVTA to marketing the Petawawa area.
The bottom line, he says, is that this is an opportunity to educate municipal leaders before they decide whether to bring in such a tax in their communities.
"A lot of people don't quite understand what the tax is about and the opportunity for communities to benefit from it", Melmoth said.
No Renfrew County municipalities have set any dates or deadlines yet for a decision on whether to establish their own Municipal Accommoation Tax.