New Brunswick proposes tourism levy on hotel stays

New Brunswick is proposing an amendment that would allow municipalities to set their own tourism tax rates.

That means hotelgoers will pay a tax set by the municipality over and above regular hotel booking fees.

Currently, tourism levies are optional, and individual hotels can set their own rates, but if the bill passes it will become mandatory. The average tourism tax in other provinces in Atlantic Canada is three per cent.

That money would be used to promote New Brunswick as a tourist destination through social media campaigns, TV ads and billboards.

The tourism industry and municipalities have lobbied for this change for years, and the province said it will give more autonomy to local governments.

The proposed amendment comes on the heels of Tuesday's provincial budget, which included an $8 million cut to the Department of Tourism.

"The intent of this isn't to backstop and backfill some of the numbers in the Department of Tourism," said Minister of Environment and Local Government Jeff Carr.

"This is about … local governments, giving them their autonomy to raise those monies and promote their areas."

Margot Cragg, executive director of the Union of the Municipalities of New Brunswick, welcomed the change but said local service districts should have been included. 

"There's already efforts in different regions to work together to talk about not just their own community but the region in general," Cragg said. 

"And if the province is taking itself out of that conversation by saying that local service districts aren't participating at all, then that's a problem for regional collaboration."

Officials representing Fredericton and Moncton welcomed the amendment, but the New Brunswick Hotel Association expressed disappointment that its members were not included in the discussion.

"At first glance it would seem the province has focused on responding to municipalities and what they want, at the exclusion of industry," read a statement from Paulette Hicks, co-chair of the association.

"There's nothing preventing cash-strapped municipalities from labelling all matter of everyday operational spending as
tourism improvements."