A consultant may be brought in to help the Town of Bracebridge investigate creating a municipal accommodation tax (MAT) by-law.
The idea was passed at the town’s Oct. 3 General Committee meeting but needs to be approved during the Oct. 11 council meeting before it can move forward.
According to a report by Paul Judson, Director of Finance and Treasurer, and Cheryl Kelley, Director of Planning and Development, the MAT allows lower-tier municipalities like Bracebridge to pass a by-law on transient accommodations (less than 30 days) and set a rate for them to be taxed at.
If the idea gets ratified, they estimate it will take around five months for the report to be finished.
“For instance, the Town of Gravenhurst, the City of Stratford, and the City of Sarnia have designated the Ontario Restaurant, Hotel & Motel Association as their agent for collecting the MAT from accommodation providers and remitting the proceeds (net of collection costs) to the municipalities,” it says in the report. “Conversely, the Town of Huntsville collects its MAT directly from accommodation providers.”
A similar tax is already in place in Barrie, Gravenhurst, Huntsville, and Orillia. In their report, Judson and Kelley point out they have set their rate at four percent. However, they add Niagara Falls and Toronto set their rates at $2 per room night and six percent respectively.
They explain at least 50 percent of the tax revenue must be shared with existing or newly created tourism-related organizations.
While not required, Judson and Kelley wrote in their report that Huntsville created the Huntsville Municipal Accommodation Tax Association to help council figure out where to direct the tax revenue. They added Gravenhurst is investigating doing the same.
“I do believe that this will be a very positive thing for Bracebridge,” said Deputy Mayor Brenda Rhodes.
Prior to being elected to council, she was the executive director of the Bracebridge Chamber of Commerce and noted she worked closely with many event organizers. “This allows for some revenue to be put into some of those events,” she said. “This allows us to build experiences in Bracebridge alone.”
Mayor Rick Maloney called reinvesting 50 percent of income from the tax “nothing but a win.”
Judson and Kelley estimate the town could collect around $440,000 annually through the tax.
