Susie Grynol, president of the Hotel Association of Canada, speaks at a news conference calling on the federal government to take action on tax avoidance by digital platforms such as Airbnb, on Parliament Hill in Ottawa. (Justin Tang/The Canadian Press)

On tax deadline day, hotels urge Ottawa to tax Airbnb

Hotel Association of Canada says taxing online rental company could bring in $100 million a year

Canada’s hotels are asking the federal Liberal government to take a heavier hand with online rental services like Airbnb and force the platforms to collect and remit sales tax.

The Hotel Association of Canada has been lobbying the government for more than a year to make online rental services collect and remit sales taxes, estimating the cost of not doing so to be some $100 million in revenues annually from Airbnb alone, not including other rental services.

Two provinces and several Canadian cities have already taken steps to regulate such businesses.

READ MORE: Airbnb to collect provincial sales tax in B.C.

But while federal officials have been receptive to the idea and are “critically aware” that there is an issue they need to tackle, they are struggling to find ways to tax digital services, said association president Susie Grynol.

“The government has a responsibility to keep up with the times and other governments around the world have done so, so it’s time for Canada to take some action as well,” Grynol told a news conference Monday.

Pressure from domestic businesses has been building on the Trudeau government to apply sales taxes to online services providers like Airbnb and Netflix, arguing that different tax treatments create an unequal playing field.

Last week a Liberal-dominated Commons committee urged Ottawa to make online service providers based outside the country collect and remit sales taxes on as part of a series of recommendations to help Canada’s small businesses compete online.

The international trade committee’s report on e-commerce issues recommended the government apply sales taxes “on tangible and intangible products” sold through online platforms, and tax the profits from those sales.

During question period Monday, Finance Minister Bill Morneau said Canada was working with other OECD countries to co-ordinate tax policies so internet giants are appropriately taxed.

Airbnb agrees to collect provincial taxes on short-term rentals in Quebec and B.C., and the company has previously said it would be willing to work with governments on further tax collection agreements.

In the rest of the country, it is up to hosts to collect sales tax and provide it to the federal government. The company has partnered with the Canada Revenue Agency to increase tax compliance, last year providing statements of earnings and educational materials to its more than 55,000 hosts.

Grynol said she would like to see the various platforms be proactive in either collecting sales taxes.

Ahead of this year’s budget, the company asked the Commons finance committee to recommend the Liberals “apply a light regulatory touch” to the online rental sector, noting that most of its hosts “are home sharing on an occasional basis.”

As for taxation, the committee submission asked the Liberals to take a “progressive and forward-looking approach.”

“Airbnb helps to democratize revenue by generating new tax revenue through hotel and tourist taxes that governments can dedicate to existing critical services, or governments can work with us to develop funding and tools to support new programs that help their middle-class citizens and address local social challenges.”

Jordan Press, The Canadian Press

Like us on Facebook and follow us on Twitter.

Just Posted

Teens youngest members in Fernie SAR history

Desire to help drives Ben Nixon and Josh Goodison to volunteer

Bear sightings prompt call for community action

Elk Valley and South Country residents have been urged to take responsibility… Continue reading

Decision opens door to short-term rentals

The City of Fernie has opened the door to the short-term rental… Continue reading

Fernie businesses go green

Instead of asking if customers need a bag, cashiers will ask if they’re okay without one.

Failing to stop at watercraft inspection station will result in $345 fine

CO Service reminding boaters it is mandatory to stop at watercraft inspection stations

Vancouver Island girl scores with winning song for BC Summer Games

‘Colours’ is a perfect theme for 2018 BC Summer Games

B.C. pipeline goes ahead despite scrapped Pacific Northwest LNG

NEB approves amendment for $1.4-billion natural gas North Montney Mainline Project

Update: Wildfire northwest of Kamloops jumps from 60 to 800 hectares

Ground crews and aircraft are responding to an estimated 50 hectare wildfire approximately 55 kilometers northwest of Kamloops, near the Deadman Vidette Road.

Feds limit chinook fishery to help killer whale recovery

Chinook is main food source for only 76 southern residents killer whales left

B.C. mom who died just before daughter’s wedding wanted family to be happy: twin

Ann Wittenberg was pulled into the ocean while on a surf board in Tofino last weekend

Courtenay-Alberni MP calls for lifeguards at popular surf spot near Tofino

The Pacific Rim National Park Reserve is defending its decision to cancel the surf guard program.

Harvey Weinstein to surrender in sex misconduct probe: officials

Would be first criminal charge against Weinstein since scores of women came forward

Second commercial acid spill in Kootenay city

Station 374 Trail was called to a Hazmat scene Wednesday night on Highway 3B

Kootenay village pot survey reveals a mixed bag

The majority of Warfield respondents were for cannabis sales, but with dispensary restrictions

Most Read