Tourism Levy Act
The Tourism Levy Act requires that providers of temporary accommodation in Alberta collect and remit the levy to Alberta Finance Tax and Revenue Administration. The AHLA estimates that 1200 hotels and motels from communities across Alberta collect and remit the levy. Roughly 96% of the guest rooms on which the levy is charged are owned by AHLA members.
When the Tourism Levy became effective on April 1, 2005, the Economic Development Minister stated that all of the funds collected would be used for tourism marketing and development. The AHLA maintains the position that the full amount of the Tourism Levy should be allocated to these types of initiatives.
Effective April 1, 2021, short-term rentals must also pay the Tourism Levy.
It is up to you to ensure you are collecting and remitting the levy properly. A number of hotels around the province have been audited, and some have received significant assessments for not charging the Levy properly.
Review the Government of Alberta’s Tourism Levy Top 10 Tips.
Exemptions from the Levy
As stated on the Government of Alberta website, the levy does not apply to:
- rooms occupied continuously for 28 days or more by the same individual
- accommodation provided by a person who does not list the accommodation on an online marketplace where
- the purchase price for the unit of lodging is less than $30 per day or $210 per week; or
- the person’s gross revenue from the provision of lodging in Alberta in the previous 12 months was less than $5,000; and
- the gross revenue in the next 12 months is reasonably estimated to be less than $5,000
- social care facilities, nursing homes, or hospitals
- licensed supportive living accommodation
- accommodation provided on a reserve in Alberta to a person or entity exempt from tax under the federal Indian Act
- the Government of Canada (direct billing)
- members of the diplomatic or consular corps
The operator can omit the Tourism Levy charge only if an exemption condition is known at the time the room is paid for and is recorded on the invoice. Operators must retain relevant documents to support all tax exempt revenue recorded. These documents are subject to inspection and audit by appointed representatives of the Provincial Treasurer.
If at first the levy is charged, and the qualification for an exemption is later established, the operator may refund the levy to the payer and deduct the amount on its next tax return. The operator should then retain the documentation to support its own deduction.