hotel tax toronto

Hotel tax coming to Toronto as early as this spring

Toronto's rental landscape is changing so quickly that it's hard to keep up. Now it seems that another layer may be added within the coming months: a 4 per cent tax on hotels and short term rentals.

City officials have proposed a 4 per cent tax on hotels, motels, and short term rentals like AirBnB, in addition to the upcoming regulations being rolled out later this year.

The idea behind the tax is to level the playing field among all commercial and private accommodations around the city by subjecting short term rentals to the same standards as bigger establishments.

The city estimates that the tax would generate around $37 million in revenue, much of which would be portioned to Tourism Toronto before being funnelled back into the city's collective piggybank.

There's been a lot of debate surrounding how to effectively regulate the short term rental craze that has swept over many major cities, with Toronto standing pretty divided on how best to proceed.

While the city considers applying the 4 per cent tax, it's also set to look at a relief program for the many small business that got slammed when their property values were reassessed. 

The proposal will go before city council for debate on January 24.

Lead photo by

Jesse Milns


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