Airbnb tax nets Ottawa $1.1M in 11 months, city says
4% accommodation tax came into effect Aug. 1, 2018
The City of Ottawa has raked in nearly $1.14 million in revenue from Airbnb rentals after it implemented a tax on listings last year.
The municipal accommodation tax on short-term rentals came into effect on Aug. 1, 2018.
In Ottawa, Airbnb renters are required to pay the four per cent tax on the combined listing price and cleaning fee of a unit.
The city collected $423,000 from the online rental service in the last five months of 2018 and another $715,006 in the first six months of 2019 up to June 30, said Wendy Stephanson, deputy city treasurer, in an email to CBC Ottawa.
That revenue was generated from some 3,200 Ottawa properties listed on Airbnb. The money is used to offset city expenditures.
In a statement, Airbnb said it helps "bring additional tourist dollars to local businesses and residents" in the city. The company added that its services bring financial benefits to areas "outside of traditional tourist zones" and give some property owners "the ability to afford to stay in their homes."
Rental affordability in question
Some critics, however, say that the potential benefits are outweighed by the company's impact on rental markets across Canada, including in Ottawa.
A March rental market study by Prism Economics and Analysis found 52 per cent of short-term rentals — which included all Air BnB listings — were within five neighbourhoods, with 36 per cent in the downtown and Lowertown areas.
- Rent in Ottawa out of reach for low-income earners, report finds
- Airbnb 'ghost hotels' keep 1,000+ homes from rental market, report suggests
Meanwhile, 80 per cent of Airbnb listings in Somerset and Rideau-Vanier are considered "ghost hotels," according to Fairbnb Canada, a group that advocates for greater regulation of the home-sharing industry.
The group's analysis found more than 1,000 homes and apartments in Ottawa were being kept from the city's rental market by landlords who instead listed the properties on short-term rental websites.
The shortage of properties is one of a number of challenges facing renters as rental rates have skyrocketed.