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

Elkford councillor Joe Zarowny remembered

The District of Elkford today announced the passing of long time councillor,… Continue reading

‘Police are ready’ for legal pot, say Canadian chiefs

But Canadians won’t see major policing changes as pot becomes legal

Fernie arena tragedy “wake up call” for global refrigeration industry

Technical Safety BC’s incident report shared across 60 countries, reaching as far as Poland

Lake Koocanusa under the microscope

Wildsight, Sierra Club BC, Headwaters Montana and U.S. university launch water sampling program

Province offers support ahead of Fernie arena tragedy anniversary

Loss of three men in workplace incident motivates Labour Minister to make B.C. safer

Legal pot price must be ‘competitive’ with black market: Blair

Bill Blair shared final words on journey to legalization ahead of official day Wednesday

Meet the City of Fernie candidates

Voters in Fernie will vote for one Mayor, six Councillors and one School Board Trustee on October 20

Meet the District of Sparwood candidates

Voters in Sparwood will vote for one Mayor and six Councillors on October 20

Meet the District of Elkford candidates

The Elkford Chamber of Commerce will host an All Candidates Forum on October 4

Mayor of Kamloops says ‘history has been made’ with vote on B.C.’s lone pot shop

The store to be run by the province in B.C.’s Interior is opening Wednesday as pot sales become legal across Canada

New bus route to ‘replace’ Greyhound along Trans-Canada Highway

Rider Express Transportation says they will soon begin a bus service from Winnipeg to Vancouver

U.S. pot firm urges Trump to deny Canadian producers ‘competitive advantage’

The challenge for U.S. firms lies in the fact that while recreational cannabis is legal in nine states and medicinal pot in 22 others, it remains illegal under federal law

Government says imprisoned Canadian terror suspects must face consequences

Public Safety Minister Ralph Goodale showed little sympathy Tuesday for such individuals who now want to return to Canada

How rules for inmate segregation in Canada will change under Bill C-83

Federal government proposing changes to rules around inmates in federal correctional institutions

Most Read