There has been quite the conversation going around that changes to taxation for short term vacation rentals, like Airbnb, will discourage people from renting out their units on a short term basis, encouraging availability for long term housing.
I beg to differ.
Back in April, the province implemented a Provincial Sales Tax to be paid by online accommodators. Personally, I didn’t see a change in the number of short term vacation rentals available. Now, those who use online platforms to rent out their rooms, apartments, and houses, will have to pay an additional tax if they earn more than $2,500 per year through their bookings.
Previously, these types of accommodators were required to pay the additional tax if they rented four or more units or rooms.
With more than 200 rooms and properties for rent on Airbnb in the Golden area, some people are hopeful that the changes will convince people to change their tune, but I doubt it will.
The lucrative idea of basically becoming a hotel manager in your own home is enticing. At $100 per night, these property managers could rent for 25 nights or less without paying the extra money. Anything after that, and they pay into the Municipal Regional District Tax (MRDT). Already, these property owners are paying eight per cent Provincial Sales Tax, so I don’t think an additional three per cent is going to make much of a difference. The MRDT is charged primarily to raise funds for tourism and marketing, which will more than likely perpetuate the problems Golden and other communities are facing.
It is widely known that towns, like Golden, struggle to bring employees in for work in hospitality and tourism markets. We have faced an ongoing and increasingly dramatic employee shortage in this town, and some of that has to do with unavailable and unaffordable housing. Hopefully some of the funds from the MRDT will be redirected to create affordable housing, but I wouldn’t hold my breath.
Additionally, there is an increasing demand for short term rentals as the tourism numbers grow. We are in a prime location to welcome tourists, and it can be good for our economy, but it isn’t good for the hard working people in this town who don’t have a place to live.
Hopefully, the Town of Golden and the provincial government continue to work on finding a balance between profitable short term rentals and long term housing. Appeasing everyone won’t be easy.