Increased rentals through agencies such as Airbnb could bring in millions in taxes if a current sales tax exemption were rescinded, the local president of the BC Hotel Association told Village of Pemberton (VOP) council Tuesday, Nov. 15.
"A year ago I never would have believed it would affect me in my business," MacKenzie said. "The growth of the nightly rentals in the past year-and-a-half has been off the charts."
MacKenzie said that on the street where he lives — among 12 homes — three of them are currently rented through Airbnb. "That's what I'm aware of."
MacKenzie said his role at the BC Hotel Association has revealed many owners throughout the province who are in agreement that the tax exemption for short-term rentals in small operations should be rescinded — and it could bring in upwards of $50 million in taxes annually if nightly operators were registered and paid their share.
Complicating the issue, MacKenzie said, is there have been little in the way of new hotel projects.
"The thing we're not seeing is any new hotel investment in B.C.," he said. "I can't stress it enough. It is a serious crisis and I think it's only going to get worse. We have a big resort corridor — everybody's looking for people right now and we want to maintain the health and vibrancy of our community right now."
To put it into perspective, MacKenzie said an example is Marriott hotels, reported to be the largest hotel chain in the world, and which pays taxes based on its assets and properties. But agencies such as Airbnb, which is reported to be worth $30 billion, doesn't pay based on taxable assets.
"We know so many of these (agencies) are collecting money under the table."
MacKenzie, who owns the Pemberton Valley Lodge, said the tax exemption could be easily rescinded as it would not require legislation from government. He added that he has similar support from areas such as Golden, Nelson, Revelstoke and Tofino, whose council recently cracked down on unauthorized nightly rentals.
MacKenzie said the effect reverberates throughout the community, which is struggling to find labour, which is in turn affected by people's ability to find affordable rental accommodation.
Mike Richman, VOP mayor, said the housing issue has repeatedly been brought to council.
"My sense is it's not going to be one solution, it will be possibly several," Richman said.
Coun. Ted Craddock echoed the concerns, saying that such businesses should be paying their fair share of taxes.
"I certainly support your initiative," Craddock told MacKenzie.
Council agreed to support the initiative, and a letter stating such will be forwarded to the B.C. government.