Ottawa to start charging Airbnb users 'accommodation tax'
Airbnb’s tagline promise to “belong anywhere” will come with a premium price tag for visitors to Ottawa this summer.
Starting in August, a 4 per cent accommodation tax will be added to all Ottawa listings by the popular home rental company. It’s the first tax of its kind in Ontario, but one that was already implemented for Ottawa hotels and motels in January. It’s also one of some 350 tax agreements the online rental service already has with governments around the world, including in Quebec and British Columbia.
For Ottawa, it means a hefty amount of revenue from its 2,700 active Airbnb hosts in the city.
“We’re looking at potentially between $300,000 and $360,000 this year,” said Wendy Stephanson, Ottawa’s Deputy City Treasurer of Revenue. “Then we’re going to monitor it from there to see what it looks like on an annual basis.”
The move comes after a landmark year for tourism to Ottawa, in part thanks to the Canada 150 celebrations, when tens of thousands of people descended on Parliament Hill and the surrounding area to celebrate the country’s 150th birthday. Some 185,000 people used Airbnb in Ottawa last year, according to app data, and Airbnb estimates that Ottawa could have made $850,000 from the tax. But the numbers won’t likely reach those heights again. International tourism to Canada set an annual record last year with 20.8 million trips of one or more nights, according to Statistics Canada data.
The company said the inevitable price hike for Airbnb listings in Ottawa won’t be too steep. “It is a marketplace, so if someone charges too much, they won’t get booked,” said Alex Dagg, Airbnb Canada’s director of public policy.
Visitors can feel assured that their extra money is doing good for the city, said Stephanson, since the tax will support Ottawa tourism and in turn support economic development. “We make an investment in terms of attracting folks here,” she said, “and they in turn make investments in spending money in our city and making it better.”
With a report from CTV Ottawa’s Claudia Cautillo