Island hospitality industry welcome Ontario’s new staycation tax credit concept

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MANITOULIN- Tourism accommodation businesses are pleased with the establishment of the new Ontario staycation tax credit which aims to get people travelling in Ontario this year, but at least one local businessperson would like to see a system in place that would see more being provided to entice visitors to travel in Northern Ontario, rather than visiting the southern part of the province. 

The “Ontario Staycation Tax Credit” program to support Ontario tourism applies to overnight stays between January 1 and December 31, 2022. Originally announced November 4, the staycation tax credit is now in effect for Ontarians who plan getaways within the province this year.

This means a return of 20 percent on accommodation expenses of up to $1,000 per person to $2,000 per family, for overnight stays in Ontario booked this calendar year. This works out to a maximum return of $200 per person or $400 per family.  

The Ontario Staycation tax credit “is a good idea,” stated Corey Stacinski, general manager of the Manitoulin Hotel and Conference Centre in Little Current last Thursday. “The idea originated in Northern Ontario, through Destination Northern Ontario, but we wanted to see double tax credits being provided for any resident who travelled north of Barrie.”

“This would get people get people to travel past Barrie and will benefit tourist operators in the North and decrease the congestion with already highly populated areas in southern Ontario. They don’t have as much of a need for further promotion to get people to visit there,” said Mr. Stacinski. “We still want see the amount doubled (for anyone who travels to the North).”

“Anything that helps domestic or international travel will help,” said Kevin Eshkawkogan, president and chief executive officer of Indigenous Tourism Ontario. “We would always like to see more but this is an incentive that definitely helps.”

“It would benefit if the credit targeted regions of Ontario and sectors of the tourism industry hardest hit,” said Mr. Eshkawkogan. He said one of those sectors is Indigenous tourism providers, pointing out 60 percent of Aboriginal tourism operators in the province are from northern Ontario. 

Mr. Eshkawkogan cautioned, “we have to be respectful and mindful of the fact that some places don’t  necessarily want more people visiting their area. It’s a balancing act, and in a nutshell we in the North could use an extra push in getting people to travel to Northern Ontario.

Dave MacLachlan, executive director of Destination Northern Ontario, told The Expositor the tax credit, “is geared in a way to help in the recovery of the Think Ontario tourism market which is so important. It is meant to get people and families travelling, when the time is appropriate, to places they may not have travelled before.” 

“It is for accommodation, but once a family for example travels to a certain area, they will also be looking for restaurants and things to do in an area that they can visit,” said Mr. MacLachlan. “Obviously right now we are in a tough situation in the province with the pandemic, but hopefully by spring things will have improved some,” said Mr. MacLachlan. The staycation tax credit, “may keep people in the province at home instead of travelling to another province.”

“The staycation tax credit is good, but I would have liked more financial help for businesses in Northern Ontario,” said Mr. Stacinski. He said that the COVID-19 outbreak is a challenge but over the next year it will be the third most challenging issue affecting the Ontario tourism market. “We’re not currently busy with the shutdown, but even if we were, we don’t have the number of employees that we need (to operate at full capacity). I was at a meeting earlier this week and it was said that we need to see an increase of 50 percent in the workforce on Manitoulin Island.”

“Its going to be a tough year,” said Mr. Stacinski. He outlined the three main challenges facing the tourism industry are the lack of employees to fill staffing vacancies, the increasing cost of doing business (especially with significant increases in the cost of food), and the pandemic. 

“Our cost across the board the costs are five to sometimes as much as 25 percent of an increase for food products,” said Mr. Stacinski. This includes an increase in cooking oil of 25 percent, he said.

Mr. Stacinski doesn’t think the current provincial protocols in place will be lifted by January 26 and said one of the most frustrating issues for businesses is the lack of information and communication coming from the province. 

Algoma-Manitoulin MPP Michael Mantha said the tax credit, “is a well overdue response to the tourism sector. “But it doesn’t go far enough. Receiving a tax credit of $200 for having to spend $4,000 in accommodations for a family will not help the tourism sector much.” 

“What should have been in place, as was presented by NDP MPP Wayne Gates in a private member’s bill, was a tax credit of $1,000 for every $1,000 spent,” said MPP Mantha. “And with this new tax credit it only is in place for accommodation. A staycation can take in many things including fishing, boating, hiking, bicycling and many more things. This should have been included as it was in Mr. Gates’ private member’s bill.” 

Ontario residents can apply for the staycation refundable credit when they file their 2022 personal tax returns and will benefit even if they do not owe any tax.

According to the government, an eligible accommodation expense has to be for a stay of less than a month at an eligible accommodation such as a hotel, motel, resort, lodge, bed-and-breakfast establishment, cottage or campground in Ontario; for a stay between January 1 and December 31 of 2022, incurred for leisure, paid by the Ontario tax filer, their spouse or common-law partner, or their eligible child, as set out a detailed receipt. The credit is subject to the Goods and Services Tax (GST)/harmonized Sales Tax (HST) as set out on a detailed receipt.