The Greater Toronto Hotel Association has raised concerns about the potential negative impact of a hotel tax increase implemented for Toronto’s upcoming FIFA World Cup games on tourism and travel to the city beyond the tournament. The Municipal Accommodation Tax (MAT) saw a 2.5 per cent increase in June, with an expected revenue of $56.6 million by next July. Despite the relatively modest increase, Sara Anghel, President and CEO of the GTHA, expressed worries that it could deter some visitors and event organizers from choosing Toronto.
Anghel highlighted the importance of maintaining competitiveness with other cities in attracting conventions and large events, emphasizing that higher taxes could put Toronto at a disadvantage. Last year, the city council approved a temporary increase in the MAT to 8.5 per cent to cover World Cup hosting costs. Anghel believes this additional tax, along with existing challenges like traffic congestion and safety concerns, could diminish Toronto’s appeal for hosting major events.
Comparatively, Vancouver also introduced a 2.5 per cent tax on short-term accommodations for its FIFA games, while cities in the U.S. and Mexico are relying on corporate sponsorships instead of tax hikes. Anghel noted the possibility of Toronto hotels exceeding revenue targets sooner than anticipated, suggesting that any surplus funds should be invested in tourism initiatives to promote the city during the tournament.
Meanwhile, higher hotel prices are unlikely to deter the expected influx of World Cup spectators to Toronto next year, according to Destination Toronto CEO Andrew Weir. He anticipates a positive impact on various business sectors as visitors engage in games, dining, and city attractions. Weir also sees the World Cup as a platform to showcase Toronto globally, with the potential to attract more international visitors in the long term.
As FIFA prepares to announce the participating teams and game locations in December, Destination Toronto plans to intensify tourism promotion efforts to capitalize on the event’s exposure and showcase the city’s vitality to a global audience.
