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

Charges upgraded against mother of murdered Langley girl

Kerryann Lewis now faces first- rather than second-degree murder in the death of Aaliyah Rosa.

WATCH: Farm Country Brewing in Langley City expected to open in summer

Farm Country Brewing is currently under construction and is planned to open in summer 2019.

LETTER: Langley letter writer takes jabs at mayor’s jersey choice

A sports fan chides Langley City’s mayor for sporting an Oilers jersey in Canucks country.

LETTER: Local Liberal MP challenges letter writer’s facts on immigration

The local MP makes the distinction between asylum seekers, immigrants and refugees.

Dr. Keith Lamont, founder of Langley Community Music School, passed away at age 89

Dr. Keith Lamont’s funeral service is on Jan. 20 at the Langley Community Music School

VIDEO: U.S. Congress to probe whether Trump told lawyer Cohen to lie

At issue is a BuzzFeed News report that about negotiations over a Moscow real estate project

Rookie Demko backstops Canucks to 4-3 win over Sabres

Young Vancouver goalie makes 36 saves to turn away Buffalo

UPDATE: Injured firefighter in stable condition

Kelowna fire crews responded to a blaze at Pope’sGallery of BC Art & Photography on Friday

Book a ride on a driverless shuttle in Surrey or Vancouver

Automated vehicle demos are being offered, as the two cities plan pilot projects with the shuttles

Heavy snowfall expected on the Coquihalla

Snowfall warning in effect for the Coquihalla Highway, from Hope to Merritt

Rare ‘super blood wolf moon’ takes to the skies this Sunday

Celestial event happens only three times this century

Arrest made after historic B.C. church hit by arson

The fire at the 150-year-old Murray United Church in Merritt was considered a possible hate crime

Missing man from Crowsnest Pass could be in Lower Mainland

58-year-old Stuart David Duff was last seen on Jan. 6, 2019.

B.C. dangerous offender in court for violating no-contact order, sends letter to victim

Wayne Belleville was shocked to see a letter addressed to him from his shooter, Ronald Teneycke

Most Read