Yellowknife tracking down unlicensed Airbnbs, VRBO listings in preparation for accommodation tax

The City of Yellowknife is in the process of tracking down all listed Airbnbs and VRBOs without business licences, in preparation for its tourist accommodation tax. 

The tax is a four per cent charge that may be placed on short-term accommodation operators such as hotels, motels, Airbnbs and VRBO listings in the city. 

The money from that tax will go from the city to a "destination marketing organization" which will be responsible for attracting more visitors to come to Yellowknife. The tax, under different names, exists in many other cities across the country. 

The City of Yellowknife has been working toward implementing a tourist accommodation tax, or levy, since 2016. It will vote on whether to adopt a bylaw for the four per cent tax at a council meeting on Dec. 9.

On Monday at a governance and priorities committee meeting, council discussed how the tax will work.

"Today is really a bit of a milestone," said Stephen Van Dine, Yellowknife's city manager. 

Coun. Garett Cochrane agreed. 

"I fully echo that sentiment, this is incredible. I'm glad we've made it, well done," he said.

But in order to enforce the tax, the city needs to know who all the operators are. 

Consultant hired to locate listings 

Speaking before council, Kerry Thistle, director of economic development and strategy, said there are over 300 short-term accommodation listings in the city. Many of these are not registered as a business or are not advertising their business licence number, which is required under a city bylaw. 

Thistle said being registered as a business will allow the city to keep track of who is required to pay the accommodation tax.

Thistle says the city has hired a consultant who will help create a list of short-term accommodation operators.

"Then we'll be able to follow up with those providers to make sure they have their business licence number and are registered," Thistle said, adding the list is expected in about two months. 

The individual operators, not the companies like Airbnb, are required to collect the tax and then send it every four months to the city. Thistle said they're discussing the idea of the companies themselves collecting the tax and paying it to the city, but it's unlikely.

"Every municipality charging different amounts and different bylaws, it makes it really difficult for [Airbnb or VRBO] to have a standard collection and remittance policy or way to do things," she said. 

Responding to a question from Coun. Ryan Fequet on enforcement of short-term accommodation operators who do not register as a business, Thistle said there is a $10,000 fine for those who do not follow the city bylaw. 

"We'll start off with gentle enforcement," Thistle said. 

"If we still see a number of businesses, accommodation providers not complying, then we will take that to the next level and issue fines." 

The bylaw will follow territorial legislation, which defines a tourist accommodation as any premise where accommodation is offered in return for money.

There are a few exceptions to the tax, including stays longer than 30 days, if the daily rate is under $20 a night, if the accommodations are for the N.W.T. government or another public agency, or the stay is for medical travel.