Internet-Based Accommodations To Be Taxed Just Like Hotel Rooms

AirBNB Helps City Introduce 4% Tax on Internet-Based Room Rentals

Those booking hotel rooms via AirBNB and the like will now pony up a little extra.

The City of Barrie, with the help of AirBNB, has introduced a 4% tax on rooms rented out through the site, the same tax already levied on traditional hotel rooms. It will come into effect May 1st.

Called the Municipal Accommodation Tax, the added cost was introduced with the help of Ireland-based AirBNB, with city staff saying the website proactively sought out the City to implement the tax. The company already had plans worked out to put the accommodation tax into play; Barrie is the sixth such city to enact an Internet-based rental tax, behind Brockville, Cornwall, Mississauga, Ottawa, and Sudbury.

Barrie Mayor Jeff Lehman admits it will be hard to enforce the tax on those who rent their properties through platforms other than AirBNB, but adds those renting their properties will have to make it public, making it easier to track them down. “I think that’s the kind of thing that over time, because it’s very public, we may start to have the ability to enforce and say ‘look, you’ve been operating these ten apartments or houses around the city as a company, as short term rentals. You need to pay the tax like everyone else.'”

It is anticipated this new tax will bring in about $120,000 a year. Fifty per cent of the funds brought in through this tax will go towards Tourism Barrie to be used to promote city attractions and events, while the rest would go towards the betterment of tourism infrastructure within Barrie; funds would be committed to studies, strategic initiatives, marketing campaigns, and any of the city’s capital assets deemed supportive of tourism. Mayor Lehman cited the in-progress Fisher Events Centre as an example.

Given AirBNB is not the only accommodations rental website, it is hard to get exact figures on how many Internet-based rentals there are in the City. Rough estimates through AirBNB and Tourism Barrie peg it at 300 to 500 rooms available in Barrie.

In June of 2018, the city introduced a 4% Municipal Accommodation Tax to all hotels, motels, and inns throughout the city save for those rented through Internet-based means. This move “levels the playing field” according to a staff report expected to be ratified at next Monday’s meeting.