Kapuskasing Town Council is considering an increase to the Accommodation Tax –that’s a percentage levied on hotel/motel room rates in the community.
The rate, which is not charged to Air B and Bs or short term rentals, would change from four to six per cent and bring in $310,000 a year.
General manager of energy and economic development Paul Nadeau says the increase would be a major boost to the Economic Development Corporation’s bottom line.
“Raising that tax by two per cent gives us that extra $100,000 that EDC needs to operate as independent from the municipality,” he said. “Currently we have $310,000 to $330,000 for operating budget.”
Nadeau said currently the EDC has to wait until April or May or its budget and makes planning difficult and committing to activities without knowing if the funds will be covered.
Nadeau added the request also includes have access to 100 per cent of the tax revenue.
“And we could set up something at $320,000 that if hotels stays keep growing in the municipality and occupancy rates go up,” he said. “Then the municipality will also benefit from the MAT Tax that anything above that $320 will come back to the municipality.”
