Ottawa

Hotel tax not worth it for many Renfrew County businesses

Some hotel owners and operators in Renfrew County are speaking out against a proposed 4 per cent tax on overnight stays that's meant to help boost tourism.

4% tax on overnight stays would be split between municipalities, tourism promoter

Jim Hemlin, chief operating officer of Calabogie Peaks Resort, says dozens of hotel owners and operators are organizing against the proposed municipal accommodation tax in Renfrew County. (Matthew Kupfer/CBC)

Some hotel owners and operators in Renfrew County are speaking out against a proposed four per cent tax on overnight stays that's meant to help boost tourism.

Jim Hemlin, chief operating officer of Calabogie Peak Resorts, said dozens of people in the accommodation businesses are coming together against the proposal.

"We would have to find a way to absorb that [extra cost] in our room rates; we're already struggling to make ends meet and try to pay the bills and also keep employment going in rural communities," Hemlin told CBC. 

He said the proposal would cost Calabogie $90,000 per year and he's concerned it would not benefit hotels, motels and Airbnbs in the largely rural region.

"It's going to look after some of the tourism that takes place throughout Renfrew County that's scattered," he said.

"But at the end of the day, we don't feel as hotel owners and operators that this money is going to drive room revenues and opportunities for us."

Hemlin said the tax would cost the resort $90,000 per year and likely need to be passed on to customers. (Andrew Foote/CBC)

The proposal splits the money between the host municipality — Renfrew County has 17 in total plus the City of Pembroke, which would also be involved — and the regional tourism promoter, Ottawa Valley Tourist Association (OVTA). 

Hemlin says dozens of hotel owners and operators plan to register their opposition to the proposal Friday morning and withdraw their membership from the OVTA.

Keeping up with competition

A similar model in the City of Ottawa goes to Ottawa Tourism, though before it was a municipal tax it was a voluntary levy restricted to hotels.  

Paul Moreau, chief administrative officer for Renfrew County, said the OVTA is funded by membership fees and some money from municipalities.

"Ottawa, Peterborough and other areas close by to us, who could be considered our competition, are using the same model and are having success drawing in local tourists," Moreau said.

"The Ottawa Valley Tourist Association wants to put itself in a better position where it has the resources to compete."

Moreau said the OVTA's last budget was about $30,000 and didn't have details on the projected revenues from the accommodation tax.

He said the region has several draws — from the ski hills at Calabogie to the Bonnechere Caves in Eganville and whitewater rafting.

Events draw hotel stays, reeve says

Peter Emon, reeve of the Town of Renfrew, said municipalities should ensure the money raised from the tax benefits the tourism businesses.

"There needs to be activities and events, because that will cause people to stay maybe one day or two days more or cause them to come back a separate time of the year," Emon said. 

Peter Emon is the Reeve of the Town of Renfrew. He said events and facilities are what draw people to stay overnight and the accomodation tax should be used to encourage that development. (Amanda Pfeffer/CBC)

He said the municipal portion of the tax should be dedicated to developing new events, promoting existing ones and could have a portion where the municipality matches part of the funds for hotels to improve their facilities.

"I don't think you can [spend] the funds without consulting and making sure the accommodation sector gets benefit from it."

Each municipality would have to approve the tax for itself.

The OVTA did not respond to CBC's requests for comment late Thursday.

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