Hoteliers to collect 3% room levy

Elizabeth Howell
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Restoring destination marketing fee to raise up to $8.5M for Ottawa Tourism

Most major local hotels will soon revive a three-per-cent room levy, a move expected to generate millions of marketing dollars for Ottawa Tourism.

Daniel Laliberte, president of the Ottawa Gatineau Hotel Association.

The new destination marketing fee also establishes two tiers of hotels in the eyes of Ottawa Tourism. The agency will now exclude from its marketing activities any hospitality facilities that are not collecting the levy.

Forty-three of the 49 members of the Ottawa Gatineau Hotel Association recently pledged to participate in the DMF program, which is slated to start Oct. 1 and is expected to raise $8 million to $8.5 million for Ottawa Tourism, according to Daniel Laliberté, OGHA president.

Two hotels in Prescott-Russell will also collect the fee, as will Carleton University, the University of Ottawa and Algonquin College for the post-secondary institutions’ summertime stays.

“It’s great for Ottawa Tourism (and) great for the hotels,” said Mr. Laliberté.

Ottawa Tourism, which focuses on attracting visitors, tours and conventions to the region, has been in financial flux since a previous iteration of the DMF ended in 2010 with the implementation of Ontario’s harmonized sales tax.

After providing bridge funding last year and in 2011, the province is expected to contribute $3.56 million to Ottawa Tourism in 2013, less than half of what’s expected to be raised by the city’s hoteliers, according to Mr. Laliberté.

He noted that, under the agreement between Ottawa Tourism and the hoteliers association, a committee will be formed made up of representatives of DMF participants. There will be four regions represented – west, east, central and suburban. Each of the regions will elect one member to be part of that committee.

These members will approve the expenditure of the funds, and Ottawa Tourism will spend the money according to its priorities, Mr. Laliberté added.

While not privy to Ottawa Tourism’s specific plans for 2013, Mr. Laliberté said he expects a continued focus on marketing the city to Montreal and Toronto, two traditionally competitive markets for Ottawa.

In May, when the DMF was first proposed publicly, Mayor Jim Watson said the city was working on a “bid more, win more, host more” approach to bring larger events to Ottawa.

He added he wants the city to “own” Canada’s 150th anniversary celebrations in 2017, similar to Vancouver and the 2010 Olympics.

Organizations: Ottawa Tourism, Algonquin College, Ottawa Gatineau Hotel Association Carleton University University of Ottawa

Geographic location: Ontario, Montreal, Toronto Canada Vancouver

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Recent comments

  • JW
    May 16, 2014 - 13:37

    Ottawa is a in demand location except for Jan. & Feb. From "Guests have been asking us what the DMF is all about. Well, here is why it is being implemented and what it means for visitors who stay in Ottawa and other major cities in Ontario. Funding for tourism and therefore promotion of Ottawa as a destination has been drastically reduced by the provincial government. The new DMF is supported by the provincial governent to generate funds for local tourism promotion agencies such as Ottawa Tourism to allow them to market themselves to potential visitors, tour operators and convention planners . This amount is remitted by the participating hotel to be used by Ottawa Tourism to promote Ottawa as a destination. It is not used for hotel marketing. This mechanism is very common in Canada as well as internationally. Hotel room taxes or fees have become an accepted method for funding destination marketing programs. The alternative to the DMF would have been a provincially mandated Hotel Tax which would in all likelihood be higher and would not necessarily be entirely directed to promoting local tourism. The DMF is only applied to the room portion of your bill, not incidental charges such as parking, long distance calls, room service, etc. The 3% DMF will be subject to HST. An example would be: Room Charge: $100.00 DMF 3.00 HST 13.39 Total $116.39 The following list shows the current taxes and charges that are in place in other Canadian cities: - Montreal – 18% …. (QST+HST=14.5% = 3.5 lodging tax) - Charlottetown – 18% …. (5% GST + 10% PST + 3% Tourism accommodation levy) - Winnipeg – 17% …. (5% HST +7% PST + 5% Accommodation Tax) - Ottawa -16.4% …. (13% HST + 3% DMF + HST on DMF)"

  • John Harris
    September 27, 2013 - 07:18

    I was surprised to be charged the DMF by my hotel (the Westin) and can honestly say that I will not revisit your region again for this simple reason. I am sure such an additional tax to tourists will only backfire causing a reduction in tourist dollars to your area. Smart thinking!!!

  • Steve
    August 01, 2013 - 19:52

    I was charged this fee at comfort inn in kanata just recently in July 2013. I asked them to remove it and they refused. I am not pleased. They cannot legally force this fee.

  • Peter Blake
    July 02, 2013 - 18:35

    I just visited Ottawa on the weekend of July 1, 2013. I discovered the hidden room surcharge, referred to as a "Destination Marketing Fee" applied to my bill. I was not pleased. This surcharge is nothing more than a deceptive marketing practice. Simply put, if you're in private business in this country, all marketing and promotional costs have to come from your own revenue not from a pseudo-governmental tax levy. If this DMF continues in Ottawa I will seek out hotels that do not participate. I will not condone, promote or otherwise endorse it.

  • Deadon
    September 04, 2012 - 22:12

    While I don't have the numbers on my tips, I tend to agree with Watchdog. I am not sure if Skeptik is actually supporting this move, but this indeed is a move that is going to further discourage tourism in the city. A lot of people leave Ottawa flat out of their touristic map (they would much rather go to Vancouver, Montreal, TO) and rather than providing them incentive to be here (of which there is very few), this move takes things in the opposite direction. Yes, the hoteliers and Ottawa tourism wins but the guests loose and they are not going to like and it will show in the eventual numbers. We pay higher HST in Ontario as we have no option but find ways of paying government workers salaries that are way beyond their capabilities. But, the guests do have an option and they will choose it.

  • Skeptik
    September 04, 2012 - 11:24

    Watchdog obviously hasn't got a clue what he's talking about. Tourism in Ottawa fall even lower? Local hotels have the highest occupancy levels and year over year growth in revenue per available room of any hotel community in Canada. How about basing your comments on fact rather than making up fiction as you go?

  • Watchdog
    September 04, 2012 - 09:42

    Now I have heard yet another boneheaded stunt of adding yet another tax on top of the HST and other services when you come to Ottawa as a guest. Let Watchdog tell you what is going to happen. Our tourism will fall even lower and guests will go somewhere else. There is nothing compelling in Ottawa to see except mabe the changing of the guard.. yawnnn, Parliament Hill, Yawn... and so forth. Ottawa needs to attract people not drive them away. Wake up call for you Dan... marketing is done on line and word of mouth and who cares if you will not let those hotels who do not collect this TAX participate in your sorry marketing schemes in yes both official languges.. News flash Dan, how many guests that came to Ottawa last year spoke even on syllable of French.. I saw many other ethinic people in Ottawa last year. This is going to be yet another disaster, and pray tell why are the Universities particpating in this????