Lake of Bays re-thinks accommodation tax
Lake of Bays Council agreed to pause the new Municipal Accommodation Tax (MAT), in the November 12, 2024, meeting.
So far feedback about the MAT has been negative, said Director of Finance/Treasurer, Patricia Allen.
She said that a public survey launched from September 20th to October 18th was met with negative responses from 179 participants.
The survey consensus included feedback like “it will increase expenses to track, report and remit, it’s a cash grab, don’t see the benefit of increasing tourism, increases costs alone to keep businesses open have placed a burden on price to customers [and] this will make it worse,” and will result in a loss of revenue for the Township.
Allen added that survey participants also indicated they were unclear about how the MAT funds will be spent.
Residents that attended the meeting were equally upset and confused about the new program.
Concerns included that not enough time was spent on developing program strategies, it’s not clear how it helps tourism, costs like the $900 licencing fee for running short term rentals are outweighing the benefits of having one anymore, guests are seeking affordability and will go elsewhere which will impact other Township businesses, accommodation providers have to pay and other businesses don’t, and it will make the area less competitive.
Many accommodation providers indicated they’re still trying to recover from Covid and stay afloat given inflation and that charging their customers more money will make them spend less on dining, shopping, grocery stores, and at other Township businesses.
Councillor, Robert Lacroix, inquired about whether the MAT rate had to be 4%.
Allen advised, “It can’t be higher than 6%.”
Lacroix suggested the Township compensate accommodation owners “because it’s going to take them time to collect all this money, send it off to the Township.” He added, “It’s work and it’s time, so to me, if we’re having staff do it, and they have to do it, it would be reasonable to give them a discount of some sort for doing all the work for us.”
Council approved staff’s recommendation to pause the By-law for implementing the program, and directed staff return with a strategic plan that will inform next steps about how they will use the MAT funds and form tourism related partnerships.