ARICHAT: Municipal council said it is satisfied with explanations of how the new tourism marketing levy will impact seasonal business owners.
“In terms of the impact on property tax of that program, it looks to be fairly minimal, we still see commercial businesses paying that higher tax rate, compared to Airbnb,” Richmond Warden Amanda Mombourquette told the regular monthly meeting of Richmond Municipal Council in Arichat on Oct. 24. “The property tax is not directly related to the marketing levy; the marketing levy is in and out, it’s something that the business doesn’t pay, they collect… as opposed to the property tax which is a direct cost.”
The province introduced amendments to the Municipal Government Act and the Halifax Regional Municipality Charter on Oct. 14 which are designed to allow municipalities across the province to charge a levy on the purchase price of hotel rooms and other accommodations.
Under the proposed legislation, the province said municipalities can choose if they want to impose the levy and at what rate, up to a maximum of three per cent of the total cost of an accommodation.
The levies vary in application and rate, the province said, noting that the proposed legislation will apply to municipalities in those areas and reduce red tape.
While all other provinces allow some form of marketing levy or accommodation tax, the province said how the levy is imposed and/or collected varies. They said Nova Scotia’s proposed approach is similar to what New Brunswick, PEI, British Columbia, and Manitoba have in place.
According to the province, the maximum rate of three per cent is lower than average rates across the country.
The warden asked if council wanted to send a letter of support to Destination Cape Breton (DCB) CEO Terry Smith asserting that the levy be applied to all fixed roof accommodations, regardless of the number of rooms; two that funds collected be used exclusively for activities and programs that directly support the development of the tourism industry, including addressing the workforce shortage; and third that there’s a seamless process to replace the Cape Breton Island Marketing Levy with new provincial legislation.
Without word from other municipalities, District 3 Councillor Melanie Sampson said they are waiting for more information.
“Somebody has to be first out of the gate here so maybe it’s time for us to stop waiting,” she proposed.
Mombourquette said the new legislation will be applied across Nova Scotia, even though it will be up to municipalities to approve and set the rate.
“Maybe we do need to have a separate conversation on the impact of the seasonal tourist business designation because it really does create a disincentive for businesses to stay open year-round,” she said. “When I think of Richmond County especially, we have such a 12-months of the year economy here, we’re less seasonal in nature.”
Deputy Warden Brent Sampson said the intent of the new levy is to provide a “more level playing” field for everyone. He said operations have to be closed for a minimum of four months to qualify for a seasonal program.
Council agreed to a suggestion from the deputy warden to hold more discussions with neighbouring municipalities and DCB.