Airbnb agrees Ontario hotel tax deal

Canada: Airbnb has announced agreements in several cities in Ontario, including Greater Sudbury, Mississauga and Brockville, which will allow short-term rental hosts to collect a four per cent hotel room tax.

Under the deal, the tax will apply to hotels, motels, bed and breakfasts, online travel sites and short-term vacation rentals rented through Airbnb, which fall within the aforementioned municipalities.

An agreement was reached between Airbnb and Greater Sudbury earlier this year and the tax is expected to raise about $425,000 for the city in 2018. Next year, the city plans to take in up to $1.7 million as a sum from the 2,000 hotel rooms located in Sudbury.

Half of that sum will go towards promoting tourism in the city with the other half helping to fund infrastructure projects like the Kingsway Entertainment Centre.

Airbnb hosts in Ontario will automatically collect and remit the tax on all bookings through the vacation rental site starting from the week commencing 1 October.

Public policy director for Airbnb in Canada, Alex Dagg, said: “This is a significant milestone for Airbnb in Ontario. At a time when communities are working hard to stretch every dollar, we can be valuable partners in strengthening local economies that are embracing home sharing.”

Over the last 12 months, the 100 Airbnb hosts in Greater Sudbury made an average earning of $7,600, which accounts for hosting visitors 89 nights a year for an average stay of 3.5 nights each time.

Dagg said Airbnb operated in more than 191 countries, from ‘apartments and villas to castles, treehouses and B&Bs’.