MARATHON — With municipal budgets and other financial matters on the go, a growing number of municipalities are exploring the viability of a municipal accommodation tax (MAT) in an effort to fund tourism initiatives/developments.
Marathon – where a municipal accommodation tax was implemented in January 2019 – is now looking to increase their municipal accommodation tax rate from four per cent to six per cent.
The current rate at four per cent generates around $140,000 annually for the municipality, but a two-per-cent increase would raise that amount to $200,000 a year.
At their regular council meeting on Jan. 29, Marathon’s chief administrative officer/clerk, Daryl Skworchinski, noted that 50 per cent of the revenue generated by the municipal accommodation tax is paid to eligible tourism entities – including any establishment where accommodations are provided such as bed and breakfasts, hotels, motels, hostels, and more – for the exclusive purpose of marketing tourism.
The other 50 per cent contributes to municipal priorities such as recreational development and maintenance.
Skworchinski recommended that the 50 per cent of MAT revenue the municipality receives should be put towards repairing and upgrading Marathon’s Active Living Centre.
Marathon’s town council approved Skworchinski’s recommendation and ratified a by-law to implement the rate increase as of March 1, 2024.
Coun. Ray Lake observed that raising the MAT rate is only fair considering how other communities benefit from visitors travelling from Marathon.
“We live in a municipality where if you have to go to a major hospital or go for tests you’re staying in a hotel in Thunder Bay where you’re paying the MAT to Thunder Bay.
"It’s nice to have a tax revenue when people are coming into a municipality, not into a residence. I think because of where we live, in general, we pay more MAT tax as we travel more than anyone else in Ontario because we have to leave this community. I’m happy to return the favour by taking some of that money back,” Lake said.
Meanwhile, Coun. Todd Wheeler questioned whether or not airbnbs fall under MAT regulations.
Skworchinski responded by pointing out that precedents have been set in other municipalities across Ontario that council and staff – including Marathon’s new by-law officer – are referencing as they work to draft a new version of the MAT by-law in Marathon to capture more of those short-term rentals.
While no date was given on when a newly drafted by-law will be presented to council, Skworchinski reassured those in attendance that it is something the municipality is actively working on.