Exclusions
The most significant issue that committee heard feedback on was the manner in which exclusions are addressed in Bill 18. Concerns about the exclusions were twofold: that the breadth of exclusions would have a negative impact on potential revenues and that it would be left to the hotel front desk staff to determine who qualifies for exclusions under the act. The following summarizes the feedback received on the subject of exclusions.
Town of Inuvik: The Mayor noted that hotels have issues with how they'll manage the tax, especially exclusions. One of the town councillors disagrees with the governments being exempted.
Days Inn and Suites Yellowknife: "Exclusions will have the effect of diluting the amount collected to the point where it is doubtful that the total amount collected on an annual basis less expenses will be an amount that would be effective in fulfilling the purpose for which the levy will be enacted in the first place."
City of Yellowknife: "The city would prefer that the Bill 18 did not contain such an exhaustive list of exclusions. Each exemption affects the overall amount to be collected. The city's second concern related to the administrative burden that the current draft of the legislation places on accommodation providers. As written, the legislation requires front desk staff to make a determination about a person's reason for travel and whether an exemption applies."
The Explorer Hotel: "The accommodation levy must be charged on all guest types (leisure, business, government, and personal). It would be difficult for a front desk worker or reservations agent to challenge a government official as to the purpose of their trip."
Committee agreed that the bill, as drafted, has the potential to place an unfair burden on hotel operators to determine if and when the exclusions set out in Bill 18 apply to a customer paying for tourist accommodation. Committee is also of the view that the potential revenue yield for a municipality should be significant enough that it makes administration of the tax financially viable.
Committee considered two options to amend Bill 18 to address these concerns: the elimination of exclusions entirely; or the creation of an exemption only for NWT residents.
I will now pass it on to my colleague, the Member of Hay River North.