Spending a night in a London hotel could soon cost visitors to the city more money.
Tourism London and city staff are calling for a 4% tax to be slapped on overnight stays in London in a report headed to the strategic priorities and policy committee on Monday.
The so-called "transient accommodation tax" would apply to hotels and motels and generate an estimated $2-million to $4-million in additional revenue annually. The money would be split evenly between the city and Tourism London.
The report states the tourism agency would be required to use its share of the funds to promote the city and attract new events.
"The financial resources that would be made available to Tourism London would give it wide-ranging capacity to augment and expand London’s reputation as a host city by allowing Tourism London to bid on major national and international sport, convention, music, and culture events; to increase promotional activity in new and existing priority markets; to develop and fund existing and new local festivals and events," according to the staff report.
The other half of the funds would be used by the city to establish a Tourism Development Infrastructure Fund to finance tourism-related projects. The overall goal is to attract more visitors to the city.
The London Convention Centre Board of Directors has already thrown its support behind the tax. In a letter addressed to the city committee, the board references its recent $5-million renovation as an example of how infrastructure funding can draw more people to London.
"Beyond the direct spend of event attendees the ability to showcase local talent and organizations to the world and introduce London to attendees for future visitations is a marketing opportunity that cannot be undervalued," the board said.
Ontario cities were granted the authority to impose the tax under legislation introduced in the 2017 provincial budget. Niagara Falls and Ottawa have already implemented the tax.
If the tax is approved, a new by-law would be drafted by the city. Politicians would then decide whether to include or exempt Airbnb and bed-and-breakfast rentals from the tax.
London is host to nearly 2.1-million overnight visitors a year.
