The Greater Toronto Hotel Association has expressed concerns regarding the impact of a hotel tax increase on tourism in Toronto, not directly related to the upcoming FIFA World Cup games. The Municipal Accommodation Tax (MAT) was raised by 2.5 per cent in June, aiming to generate around $56.6 million by July next year.
Sara Anghel, the president and CEO of the Greater Toronto Hotel Association, mentioned that while the increase may seem modest, it could deter potential visitors and organizers of large events from choosing Toronto. She emphasized that higher taxes could diminish the city’s competitiveness compared to other event-hosting cities.
Last year, the city council approved a temporary increase in the MAT to 8.5 per cent to cover expenses related to hosting six World Cup matches. This increase will remain in effect until July 31, 2026. Anghel expressed concerns that the tax hike, combined with existing challenges like traffic congestion and safety issues, could hinder Toronto’s attractiveness for conventions and city-wide events.
In a similar move, Vancouver implemented a 2.5 per cent tax on short-term accommodations for its FIFA games starting in February 2023. Anghel noted that U.S. and Mexican host cities have opted for corporate sponsorships instead of imposing such taxes.
Despite these concerns, Anghel acknowledged that Toronto hotels might meet fundraising goals sooner than expected due to a successful summer season and ongoing support for the Toronto Blue Jays. She suggested that any surplus funds raised should be reinvested in tourism initiatives to enhance the city’s promotion during the tournament.
Meanwhile, Andy Weir, CEO of Destination Toronto, reassured that the anticipated influx of FIFA World Cup spectators next year would not be deterred by higher hotel prices. He highlighted the positive economic impact these visitors would bring to various sectors in the city, with potential long-term benefits in attracting global tourists.
Weir emphasized the opportunity for Toronto to showcase its vibrancy during the World Cup, anticipating a boost in international visibility and tourism. Destination Toronto plans to intensify promotional efforts in alignment with FIFA’s upcoming team announcements to capitalize on the event’s global audience.