Municipal Accommodation Tax

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What is a Municipal Accommodation Tax (MAT)?

A Municipal Accommodation Tax (MAT) is a tax imposed by a local government or municipality on the price of overnight accommodations in its jurisdiction. Typically applied to hotels, motels, inns, bed and breakfasts, and other lodging establishments, this tax is collected from guests at the time of their booking. The primary purpose of the MAT is to generate additional revenue for the municipality to support various initiatives, such as tourism promotion, tourism infrastructure development, and public services, which directly or indirectly benefit both visitors and residents alike.

By implementing this tax on accommodations, municipalities can fairly distribute the costs of hosting tourists and maintaining tourism-related amenities, all without burdening local residents with increased taxes.

Introducing a MAT will provide a sustainable stream of funding for Lincoln's tourism growth and infrastructure which will support the creation of additional tourism related jobs and economic growth. This project is in the early stages and the Town will begin seeking public input to help determine next steps on MAT. See below for various public engagement opportunities.

Have Your Say

1. Ask a question.

Use our Question/Answer tool below to share your thoughts or ask a question. Submitted questions/comments are moderated before they are published.

4. Contact a project lead.

Project leads are noted at the right of this page, under "Who's Listening."


Why Implement a MAT in Lincoln?

As defined in the Tourism Strategy and Action Plan 2020-2025, Lincoln’s greatest opportunity for economic growth resides within its diverse tourism sector. However, it also acknowledges that increased tourism comes with associated challenges. 

The primary objective of the MAT is twofold:  

  1. To generate additional revenue to support tourism growth in the municipality.

  1. To shift the responsibility for managing these costs away from residents and onto the visitors who enjoy our local amenities.  

While both residents and visitors can enjoy attractions such as wineries, museums, restaurants, boutique retail and more, the MAT legislation recognizes that residents should not face penalties for utilizing amenities in their communities. What sets visitors' needs apart from residents is the need for overnight accommodations.  

A MAT provides funding for local tourism-based organizations like Destination Marketing Organizations (DMOs), to support the tourism industry and local tourism infrastructure. This tax enhances investments in tourism marketing, sales and product development, putting dollars back into the local visitor economy. A MAT provides local tourism with a diversified and reliable source of income that builds the economic resiliency of local destinations.  

Implementation & Use of MAT Revenue

All single-tier and lower-tier municipalities have the authority to implement a MAT. A MAT is not mandatory; local municipalities can decide to apply the tax. Upper-tier municipalities do not have the authority to implement a tax. Municipalities have the flexibility to determine the design, administration and collection of the tax including its rate. 

The Municipal Act, 2001 mandates revenue sharing for municipalities that implement a MAT with an "eligible tourism entity," such as a Destination Marketing Organization, Regional Tourism Organization, or similar groups. “Eligible tourism entity” is defined as a non-profit entity whose mandate includes the promotion of tourism in Ontario or a municipality. Municipalities are required to share a minimum of 50% of the MAT revenues (less reasonable cost of collecting and administering the tax) with an eligible tourism entity. MAT revenue given to an eligible tourism entity is meant to supplement, not replace current funding.  

The agreement between the municipality and eligible tourism entity will ensure that amounts paid to the entity are used for the exclusive purpose of promoting tourism in the respective community. The legislation allows municipalities to keep a portion of the funds generated for tourism-related infrastructure and destination management.  

See the attached chart under "Resources" to the right of this page, which outlines the estimated revenue generated from the MAT based on our existing accommodations inventory in Lincoln.


MAT & Short-Term Accommodations (STAs)

The legislation allows municipalities to decide which short-term accommodations the tax applies to. The tax can only apply to accommodation that is short-term in nature, which is a maximum of 28 consecutive days or less. Transient accommodation is purposely left undefined in legislation, as it allows each municipality to determine the types of short-term accommodation the tax would apply to. For Lincoln, short-term accommodations are defined as follows: 

The tax is applied to accommodation fees only, not additional services. 

Legislation

Section 400.1 of the Municipal Act, 2001, S. O. 2001, c.25, provides that the council of a municipality may pass by-laws imposing a tax in respect of the purchase of transient accommodation within the city. Amendments were introduced as part of the 2017 Provincial Budget and received Royal Assent on May 17, 2017.

Ontario Regulation 435/17: Transient Accommodation Tax under the jurisdiction of the Municipal Act, 2001 came into effect December 1, 2017, allowing municipalities to levy a Municipal Accommodation Tax.

Collection & Administration

The Town of Lincoln has the authority to determine the reporting and remittance frequency for a MAT in Lincoln. Accommodation providers will be required to include a separate line item on all invoices or receipts identifying the “Municipal Accommodation Tax” for auditing purposes. Town Staff will provide access to online forms for registration and remittance activities, in addition to “hands-on” support such as educational webinars and program guidelines to assist local operators with collection and remittance activities.   

Project Updates

The Town is undertaking public consultations to make recommendations to Council about MAT spending. We will provide ongoing updates as they become available, including the finalized MAT rate, a municipal by-law, and more. Follow this page for project updates. 

What is a Municipal Accommodation Tax (MAT)?

A Municipal Accommodation Tax (MAT) is a tax imposed by a local government or municipality on the price of overnight accommodations in its jurisdiction. Typically applied to hotels, motels, inns, bed and breakfasts, and other lodging establishments, this tax is collected from guests at the time of their booking. The primary purpose of the MAT is to generate additional revenue for the municipality to support various initiatives, such as tourism promotion, tourism infrastructure development, and public services, which directly or indirectly benefit both visitors and residents alike.

By implementing this tax on accommodations, municipalities can fairly distribute the costs of hosting tourists and maintaining tourism-related amenities, all without burdening local residents with increased taxes.

Introducing a MAT will provide a sustainable stream of funding for Lincoln's tourism growth and infrastructure which will support the creation of additional tourism related jobs and economic growth. This project is in the early stages and the Town will begin seeking public input to help determine next steps on MAT. See below for various public engagement opportunities.

Have Your Say

1. Ask a question.

Use our Question/Answer tool below to share your thoughts or ask a question. Submitted questions/comments are moderated before they are published.

4. Contact a project lead.

Project leads are noted at the right of this page, under "Who's Listening."


Why Implement a MAT in Lincoln?

As defined in the Tourism Strategy and Action Plan 2020-2025, Lincoln’s greatest opportunity for economic growth resides within its diverse tourism sector. However, it also acknowledges that increased tourism comes with associated challenges. 

The primary objective of the MAT is twofold:  

  1. To generate additional revenue to support tourism growth in the municipality.

  1. To shift the responsibility for managing these costs away from residents and onto the visitors who enjoy our local amenities.  

While both residents and visitors can enjoy attractions such as wineries, museums, restaurants, boutique retail and more, the MAT legislation recognizes that residents should not face penalties for utilizing amenities in their communities. What sets visitors' needs apart from residents is the need for overnight accommodations.  

A MAT provides funding for local tourism-based organizations like Destination Marketing Organizations (DMOs), to support the tourism industry and local tourism infrastructure. This tax enhances investments in tourism marketing, sales and product development, putting dollars back into the local visitor economy. A MAT provides local tourism with a diversified and reliable source of income that builds the economic resiliency of local destinations.  

Implementation & Use of MAT Revenue

All single-tier and lower-tier municipalities have the authority to implement a MAT. A MAT is not mandatory; local municipalities can decide to apply the tax. Upper-tier municipalities do not have the authority to implement a tax. Municipalities have the flexibility to determine the design, administration and collection of the tax including its rate. 

The Municipal Act, 2001 mandates revenue sharing for municipalities that implement a MAT with an "eligible tourism entity," such as a Destination Marketing Organization, Regional Tourism Organization, or similar groups. “Eligible tourism entity” is defined as a non-profit entity whose mandate includes the promotion of tourism in Ontario or a municipality. Municipalities are required to share a minimum of 50% of the MAT revenues (less reasonable cost of collecting and administering the tax) with an eligible tourism entity. MAT revenue given to an eligible tourism entity is meant to supplement, not replace current funding.  

The agreement between the municipality and eligible tourism entity will ensure that amounts paid to the entity are used for the exclusive purpose of promoting tourism in the respective community. The legislation allows municipalities to keep a portion of the funds generated for tourism-related infrastructure and destination management.  

See the attached chart under "Resources" to the right of this page, which outlines the estimated revenue generated from the MAT based on our existing accommodations inventory in Lincoln.


MAT & Short-Term Accommodations (STAs)

The legislation allows municipalities to decide which short-term accommodations the tax applies to. The tax can only apply to accommodation that is short-term in nature, which is a maximum of 28 consecutive days or less. Transient accommodation is purposely left undefined in legislation, as it allows each municipality to determine the types of short-term accommodation the tax would apply to. For Lincoln, short-term accommodations are defined as follows: 

The tax is applied to accommodation fees only, not additional services. 

Legislation

Section 400.1 of the Municipal Act, 2001, S. O. 2001, c.25, provides that the council of a municipality may pass by-laws imposing a tax in respect of the purchase of transient accommodation within the city. Amendments were introduced as part of the 2017 Provincial Budget and received Royal Assent on May 17, 2017.

Ontario Regulation 435/17: Transient Accommodation Tax under the jurisdiction of the Municipal Act, 2001 came into effect December 1, 2017, allowing municipalities to levy a Municipal Accommodation Tax.

Collection & Administration

The Town of Lincoln has the authority to determine the reporting and remittance frequency for a MAT in Lincoln. Accommodation providers will be required to include a separate line item on all invoices or receipts identifying the “Municipal Accommodation Tax” for auditing purposes. Town Staff will provide access to online forms for registration and remittance activities, in addition to “hands-on” support such as educational webinars and program guidelines to assist local operators with collection and remittance activities.   

Project Updates

The Town is undertaking public consultations to make recommendations to Council about MAT spending. We will provide ongoing updates as they become available, including the finalized MAT rate, a municipal by-law, and more. Follow this page for project updates. 

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