Tourists could be charged up to 4 per cent a day on hotel stays in Yellowknife

Tourists coming to Yellowknife could see an extra charge on their hotel bills in the future. A long-discussed tax on tourist accommodations was up for discussion at city hall Monday afternoon.

Hotel levy discussed at city hall on Monday

The Explorer Hotel in Yellowknife. Tourists in the city could see an extra charge on their hotel bills in the future. A long-discussed tax on tourist accommodations was up for discussion at city hall Monday afternoon. (Randall McKenzie/CBC)

Tourists coming to Yellowknife could see an extra charge on their hotel bills in the future.

A long-discussed tax on tourist accommodations was up for discussion at city hall Monday afternoon.

The tourist accommodation tax would charge up to four per cent a day on a visitors' hotel or motel bill. It could also extend to bed and breakfasts and short-term rentals such as Airbnb.

"The goal would be to make tourism sustainable throughout the entire year, not just specific peak times," explained Kerry Penney, the city's director of policy, communications and economic development.

The tax could bring in between $750,000 to $1.5 million a year.

'The goal would be to make tourism sustainable throughout the entire year, not just specific peak times,' explained Kerry Penney, the city’s director of policy, communications and economic development. (Gabriela Panza-Beltrandi/CBC)

That money would go toward creating a destination marketing organization for Yellowknife. Penney compared it to NWT Tourism, which is a not-for-profit contracted by the territorial government to market the territory as a tourism destination.

Marketing campaigns could include highlighting local festivals like Folk on the Rocks and the Long John Jamboree, as well as promoting the city as a conference and convention destination.

The plan would include consulting with NWT Tourism, Yellowknife's hotel association and other accommodation providers who could be subject to the tax.

"We want to work closely with these groups to ensure that it's a smooth transition," said Penney.

"Hotels need time to get it into their systems. We need time to educate people so we'll have a phased-in approach."

'Very difficult' without tax

Visitors contribute, on average, $250,000 a day directly to Yellowknife's economy, working out to more than $90 million a year, according to a city tourism website.

"Without increased promotion there will be slower growth in the tourism sector," it says.

"That will mean slower economic growth for Yellowknife, fewer new job opportunities and less money circulating through the Yellowknife economy."

The lobby of the Chateau Nova Hotel in Yellowknife. The tourist accommodation tax would charge up to four per cent a day on a visitors' hotel or motel bill. (Randall McKenzie/CBC)

Creating a destination marketing organization would cost at least $1 million. The site says without the tax, raising the money to promote Yellowknife as a tourism destination would be "very difficult."

Some visitors could be exempt from the tax, such as people coming to the city for medical travel and territorial government employees travelling for work.

City administration will now come up with an implementation plan for the tax to bring before council. According to the city website, it could take up to a year to get the accommodation tax in place if approved by council.