Without any debate, members of the finance committee approved a new accommodation tax Tuesday, which will see a levy put on hotel and motel rooms in the city.
The new tax on the city's 2,000 hotel rooms is expected to bring in $1.7 million in 2019, half of which will be used to finance tourism initiatives, with the other half helping to pay the mortgage on the $100 million arena planned for the Kingsway. The tax should raise about $425,000 for the balance of 2018.
The province passed a law in 2017 giving municipalities the right to bring in the tax, and Sudbury is the third city to do so, following Toronto and Ottawa's lead. Another eight municipalities are in the process of implementing the tax.
“It is proposed that the MAT will apply to accommodations which are provided for consideration where a bed is provided, whether or not there are additional amenities or services,” a report on the idea said. “Examples would include hotels, motels, motor hotels, lodges, resorts, bed and breakfast establishments, and all or part of a dwelling unit, such as occurs with Airbnb. The MAT will be applied to the fees and charges for the accommodation only.”
The money earmarked for tourism will be handled by the Greater Sudbury Community Development Corp. It could be used to support local festivals, sporting tournaments, advertising or even bidding to host major sporting events.
The total mortgage for the $100-million arena is $5.2 million a year for 30 years. In addition to the hotel tax, the city will use the $1 million it had been paying to support the Northern Ontario School of Architecture that was coming off the books anyway.