To provide more funding for initiatives that benefit residents and tourists alike without further increasing the property tax burden on local residents, Stratford council has approved a four-per-cent municipal accommodations tax to be levied from visitors beginning July 1, 2023.
More than a year and a half after a plan to implement a municipal accommodations tax was put on hold as a result of the COVID-19 pandemic, Stratford council has given its seal of approval for the tourism tax that will be levied from visitors staying in local hotels, motels, B&Bs and other short-term accommodations.
At Monday’s regular council meeting, councilors voted 10-1 to implement a four-per-cent municipal accommodations tax beginning July 1, 2023, giving city staff enough time to communicate with local accommodators and the public about the impacts this new tax will have, allow council to approve and pass the necessary policies and bylaws — as well as pass the city’s new short-term-rental-accommodations licensing bylaw — and allow more time for local accommodations businesses to recover from the effects of the COVID-19 pandemic.
Having been adopted by many municipalities across Ontario and around the world, a municipal accommodations tax is meant to supplement municipal tourism investments with revenues raised from visitors. While not intended to fully replace those municipal tourism investments, the tax provides additional funds for services that benefit visitors and residents alike while offering stabilized base funding for tourism.
Revenue collected through this tax — likely by a third-party organization according to a council report — will be shared equally between the city and Destination Stratford, however council will have the option to increase the city tourism agency’s share of the revenue in the future. With that extra tourism revenue coming in, council will also have the opportunity to look at reducing the municipality’s annual funding for the tourism agency once the tax is in full effect, potentially reducing the impact the city’s tourism spending has on municipal property taxpayers.
Stratford’s municipal accommodations tax is expected to bring in roughly $800,000 annually, the city’s share of which could be spent on everything from improving local roads and capital projects within city parks and facilities to sports-tourism initiatives, improving or establishing local trails or improving other existing infrastructure that both supports tourism and benefit residents.
More to come…