Ottawa tourists are facing a tax hike to spend a night in a hotel room in the capital in 2024.
The city of Ottawa’s 2024 budget proposes increasing the Municipal Accommodation Tax Rate from 4 per cent to 5 per cent, effective Jan. 1, 2024.
The Municipal Accommodation Tax is collected by hotels on all rooms in the city of Ottawa, which supports marketing Ottawa as a tourist destination.
“The Municipal Accommodation Tax revenue is provided to Ottawa Tourism for the purposes of promoting and growing the tourism industry in Ottawa,” the city of Ottawa says on its website. “The funds will be used to promote Ottawa and the Capital region as well as to support product development and tourism growth.”
The Municipal Accommodation Tax came into effect in Ottawa in January 2018.
According to the city of Ottawa’s budget, the Municipal Accommodation Tax collected $14.5 million in 2022 and is expected to generate $16 million in 2023, down from the budgeted total of $18 million. The budget estimates the Municipal Accommodation Tax will generate $20.3 million in revenue for Ottawa Tourism in 2024.
The city of Toronto has a Municipal Accommodation Tax, which increased from 4 per cent to 6 per cent in May. The tax provides funding for Destination Toronto, which supports the tourism industry, along with programs and services that visitors use when visiting Toronto, including roads, transit, culture and parks.