Proposed Visitor Rebate Cut to Cost Feds Millions

Proposed Visitor Rebate Cut to Cost Feds Millions

September 27, 2006 – Ottawa – The Hotel Association of Canada (HAC) today called for the withdrawal of the decision to cut the GST Visitor Rebate Program as announced by the Federal Government on Monday, September 25.

“The proposed cut will in fact cost the government of Canada up to $218 million just in lost hotel tax revenue as opposed to the $78.8 million in proposed savings,” said HAC President Tony Pollard. The HAC’s greatest concern with this proposed elimination of the GST Rebate Program involves the group and convention business. The total value of this business in Canada in 2005 from outside the country is in excess of $1.28 billion. This proposed program cut puts this at very serious risk by increasing the cost to do business in Canada by six per cent.

“The government is shooting itself in the foot by jeopardizing federal, provincial and municipal tax revenues of $496 million, $218.5 million of which goes directly to the federal level,” stated Pollard.

The HAC is dismayed by the government’s apparent lack of concern and support for the Canadian lodging, travel and tourism sector. The decision to eliminate the GST Rebate Program simply does not add up and the HAC has contacted Minister of Finance, the Honourable James Flaherty, to request that this regressive motion be immediately withdrawn.

The Hotel Association of Canada is the national organization representing the lodging industry in Canada. Our membership encompasses the provincial and territorial hotel associations, corporate hotel chains, independent hotels, motels and resorts and the many industry suppliers. Our objective is to assist both our national and international members as they endeavor to enhance their competitiveness and achieve their bottom line.