Vancouver’s tourism marketer plans to hike one of the taxes that hotel guests pay by 50% to 3% from 2% effective September 1 thanks to approval from the provincial government.
The tax hike comes following the busiest summer tourist season in the city in many years.
That hotel tax, cryptically dubbed the Municipal and Regional District Tax (MRDT), is in addition to the 8% provincial sales tax levied on hotel room visits.
The B.C. government announced July 31 that it now allows all municipalities in the province to increase the MRDT if desired.
“This is an important move by government to support Metro Vancouver's $6.1-billion tourism industry,” said Tourism Vancouver CEO Ty Speer.
“Funds from the MRDT will continue to contribute to Tourism Vancouver's global marketing initiatives and ultimately bring more visitors, events and conventions to our destination, benefiting not only Vancouver but also cities and tourism businesses throughout British Columbia.”
Tourism Vancouver has long been lobbying Victoria for the ability to hike the MRDT, which is almost the exclusive source of Tourism Vancouver’s approximately $13.6 million budget.
Having the extra revenue from the MRDT will also help Tourism Vancouver nibble away at what has been an increasing debt thanks to interest payments on debt initially racked up on a $90 million commitment to finance the Vancouver Convention Centre.
The federal and provincial governments picked up the rest of the tab.
Tourism Vancouver paid $1 million in the 2007-08 fiscal year so its obligation starting in April 2008 was $89 million.
By last year, that debt had ballooned by about $18.6 million to nearly $107.6 million and, according to Tourism Vancouver projections, will rise to $143.6 million by April 2035 before the tourism marketer can start reducing it.
