Municipal Accommodation Tax (MAT)

image of hand opening a hotel door

Background

On Thursday November 23, 2017, the Province of Ontario issued the Transient Accommodation Regulation 435/17, which came into force December 1, 2017 and provides the necessary provisions for municipalities across Ontario to implement a Municipal Accommodation Tax (MAT)

On October 29th, 2018, Huntsville Town Council passed By-Law 2018-131, approving the implementation of a four percent (4%) mandatory MAT applicable on all short-term accommodations under 30 days.

The MAT will come into effect on April 1st, 2019, and applies to all accommodation sold for a continuous period of less than 30 days in a hotel, motel, lodge, inn, and bed and breakfast.

Use of Revenue Generated Through the Program

The tax will generate funding to promote and develop tourism within Huntsville. 70% of the net revenues will be directed towards a newly established Non-Share Capital Corporation who's sole focus will be the enhancement and promotion of Tourism in Huntsville. This organization will direct funds towards tourism promotion and development with a focus on attracting more visitors to the Town through sports and cultural events, new product developments, and enhanced attractions and outdoor activities.

The other 30% of the net revenues will be retained by the Town of Huntsville, earmarked for projects and initiatives that promote and support tourism and economic development efforts that benefit residents and visitors.

About the Legislation

The Municipal Accommodation Tax is a new revenue tool that the provincial government has given Ontario municipalities to further promote tourism as an economic driver.

On May 17, 2017, the Province enacted Bill 127, Stronger, Healthier Ontario Act, 2017, providing municipalities the authority to levy a transient accommodation tax (hotel tax). The Transient Accommodation Regulation 435/17 came into force on December 1, 2017, outlining provisions for municipalities across Ontario to implement a Municipal Accommodation Tax (MAT).

The Regulation applies if a municipality imposes a tax in respect of the purchase of transient accommodation in the municipality under section Municipal Act 400.1 of the Act.

Background

On Thursday November 23, 2017, the Province of Ontario issued the Transient Accommodation Regulation 435/17, which came into force December 1, 2017 and provides the necessary provisions for municipalities across Ontario to implement a Municipal Accommodation Tax (MAT)

On October 29th, 2018, Huntsville Town Council passed By-Law 2018-131, approving the implementation of a four percent (4%) mandatory MAT applicable on all short-term accommodations under 30 days.

The MAT will come into effect on April 1st, 2019, and applies to all accommodation sold for a continuous period of less than 30 days in a hotel, motel, lodge, inn, and bed and breakfast.

Use of Revenue Generated Through the Program

The tax will generate funding to promote and develop tourism within Huntsville. 70% of the net revenues will be directed towards a newly established Non-Share Capital Corporation who's sole focus will be the enhancement and promotion of Tourism in Huntsville. This organization will direct funds towards tourism promotion and development with a focus on attracting more visitors to the Town through sports and cultural events, new product developments, and enhanced attractions and outdoor activities.

The other 30% of the net revenues will be retained by the Town of Huntsville, earmarked for projects and initiatives that promote and support tourism and economic development efforts that benefit residents and visitors.

About the Legislation

The Municipal Accommodation Tax is a new revenue tool that the provincial government has given Ontario municipalities to further promote tourism as an economic driver.

On May 17, 2017, the Province enacted Bill 127, Stronger, Healthier Ontario Act, 2017, providing municipalities the authority to levy a transient accommodation tax (hotel tax). The Transient Accommodation Regulation 435/17 came into force on December 1, 2017, outlining provisions for municipalities across Ontario to implement a Municipal Accommodation Tax (MAT).

The Regulation applies if a municipality imposes a tax in respect of the purchase of transient accommodation in the municipality under section Municipal Act 400.1 of the Act.

Q&A

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  • Why would it be that not one dime of this tax goes to anything other than tourism? It is almost unheard of that a government tax does not go to general revenues for obvious reasons as it allows these tax administrators (ie. the tourism operators) to cherry pick where their tax dollars go

    WHILLAP asked about 1 month ago

    Thank you for your inquiry, in the documents section of this page, there is a report titled Municipal Accommodation Tax - Financial Policy, which outlines how the Town plans to spend their portion of the revenue, it is not solely focused on Tourism. 

    When developing this program with our stakeholders we did feel it was important that the money collected through Tourism receipts should be redirected towards increasing and developing Tourism, marketing, programming and infrastructure in the community which will also benefit residents. 

    Thanks

  • How will it be enforced for businesses? I'm curious how you will tax cottage rentals and more such as Air BnB area rentals.

    KMorrison asked 4 months ago

    Sections 8 - 13 in the Municipal Accommodation Tax By-Law outlines the enforcement options the Municipality has, the by law is included in the documents section related to this project for you review.

    Town staff are currently working to include all short term vacation rental platforms in the MAT program and have had preliminary discussion with platforms such as Air BnB.

    Thank you

  • Hello. How will this be inforced?

    KMorrison asked 4 months ago

    Could you please clarify, enforced on businesses or guests?

    Thank You

  • just another tax to avoid when travelling; Someone lost sight about visitors keeping locals employed by their local spending

    silver glen asked 6 months ago

    Thank you for your comment respecting the implementation of the Municipal Accommodation Tax in Huntsville.

    In our discussions with our Hotelier Partners they to acknowledge that business could be lost though the implementation of this program; however we collaboratively agreed that the potential positive impacts of this program through increased marketing and programming efforts would ultimately bring more revenue to the community and local businesses.


  • Are small seasonal Bed and Breakfasts that are operating as small businesses earning under $30,000 per year so therefore not currently charging any tax subject to this 4% accommodation tax?

    Janet asked 6 months ago

    Yes, B&B's that are operating as small businesses regardless of revenue are expected to charge this Tax. We understand during the initial implementation phase that some operators may have been missed due to the scale of their business and we will be following up with them.

    As the program progresses we will also be looking to include short term vacation rentals

  • Hi How will you be handling AIRBNB ? A google search shows that Huntsville have a large number of AIRBNB so this should generate significant funds

    redwood asked 6 months ago

    The Town will be working with all short term vacation rental platforms with the goal of including them all in the MAT program. 

    This will be conducted during our 2nd phase of the program which will be taking place throughout 2019 and into 2020.

  • Should this tax be applied to accommodations that were booked several months in advance and before the approval on October 29th, 2018 with the MAT coming into effect on April 1, 2019?

    Kyle asked 6 months ago

    If your accommodation was booked and paid for prior to April 1, 2019, the tax will not be applicable. 

    If it was booked before April 1, 2019 but paid for on April 1, 2019, or later, the tax is applicable.


  • Is this tax per room or per person.

    Susan asked 6 months ago

    Thanks for the inquiry,

    The Tax is per room and not per person. Additionally items such as parking, Wi-F,i or meals are not subject to the Municipal Accommodation Tax

    Thank you