The provincial government is scrapping its five-per-cent hotel room tax and replacing it with a new surcharge that will deliver $42.4 million into Alberta tourism coffers next year.
Changes to the tax system, to take effect on April 1 next year, will result in 75 per cent more funds annually for tourism marketing and development, Economic Development Minister Mark Norris said last week.
The existing five-per-cent hotel tax will be replaced by a tourism levy of four per cent, meaning consumers will pay one per cent less tax.
All funds from the tourism levy will now be earmarked for provincial tourism initiatives. “This is great news for tourism in Alberta,” said Norris.
“Over the past three years there has been a great deal of work by government and industry to find ways to provide long-term sustainable funding for this industry. Today, we can celebrate this accomplishment.”
The budget increase will help Alberta become more competitive with jurisdictions such as British Columbia, Ontario and Quebec, Norris said.
Alberta’s $42.4 million in tourism funding for 2005-06 compares with $56.4 million for B.C., $144 million in Ontario and $124.7 million in Quebec. In 2006, Alberta funding is projected to reach $48 million Mac Makenny, co-chair of the Strategic Tourism Marketing Council, welcomed the funding changes.
“We have a great product that people love once they learn about it – this increased investment is vital to help us sell this great province to Canada and the world,” Makenny said.
The council is a partnership between government and the private sector that works to promote tourism in Alberta.
Tourism is one of Alberta’s largest industries, generating more than $5 billion each year and employing more than 124,000 people.
The industry generates more than $680 million in revenues for the Alberta government through direct and indirect taxation.
