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Owner-direct rentals questioned

Property manager says province, RMOW missing out on hotel tax

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As the global economic downturn continues to affect Whistler, at least one accommodation provider is questioning the way the provincial government manages the hotel tax it shares with the resort community.

At the root of the issue is the way the provincial government describes those who must remit the eight per cent hotel tax and the additional two per cent municipal and regional district tax.

The province states that only accommodation providers renting out four or more properties in B.C., which meet certain standards, must collect the 10 per cent tax and remit it to Victoria. Owners with less than three properties don't need to collect the hotel tax.

Many of these owners now reach prospective renters through web-based facilitator companies, which have grown in number as the Internet and self-booking vacations becomes more and more popular.

Property management companies, on the other hand, must charge vacationers the hotel tax on accommodations rented out. This is not a level playing field said Dave Norris, president of WhistlerAccommodation.com.

"It's just an advantage that they have that is not a positive advantage for the collection of the tax, and it is not a positive thing for Whistler resort or any other resort," he said.

WhistlerAccommodation.com, which has been in business since 1989, is so concerned it is looking at re-structuring so that rather than acting as a property manager it will simply be the go-between for owners and renters, thus avoiding having to charge the tax.

"We are reviewing the option to restructure our company..." said Norris in a letter.

Generally property management companies charge owners a fee, say 25 per cent, to maintain and market units for rent. This is usually built into the accommodation cost.

Those owners who maintain their own properties and offer them for rent through facilitator web companies - owner-direct rentals - are not charged fees of this nature. In some cases this can make their accommodations more affordable.

Norris is also concerned that the growth in owner-direct rental will impact the quality of the vacation experience in Whistler.

".... On any given Friday or Saturday night you can see people driving all over the place trying to find a street: Where is Blackcomb Way, where is Spearhead Drive, where is this building?" said Norris.

He has no argument with owners who rent properties themselves in "Mom and Pop" type operations, but he believes that large web-based accommodations providers, with hundreds of homes listed, should have to collect the 10 per cent hotel tax.

Not so says the provincial government. While no one was available to comment on the record during the current interregnum - the period between governments - it was clarified that a web-based facilitator is not considered a property manager. Nor is a web-based facilitator considered to be "offering accommodation." Rather, they are marketing, not offering.

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