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Greater Victoria, BC News

ARTICLE

Date ArticleType
1/3/2017 Published Article
Short Term Residential Rentals - Inevitable

GREATER VICTORIA - As British Columbians continue to embrace the sharing economy, short term residential rental providers are gaining a larger presence throughout our province. Airbnb, a peer-to-peer online network that enables people to list or rent short term lodging in residential properties, already has a strong footprint in Greater Victoria, offering a range of options from private and semi-private rooms to entire units.

Most providers’ business models are modern, progressive, commonly available in other jurisdictions, and are often quite well resourced. Many would argue short term residential rentals are unstoppable and their entrenchment in our communities inevitable.

The Greater Victoria Chamber of Commerce welcomes short term residential rentals, as long as their providers operate within a fair and competitive environment. The rentals can add capacity when tourism is booming, bringing more visitors to Greater Victoria than otherwise possible, supporting local businesses and our economy.

Our concern; however, is that short term residential rentals do not fall under the regulatory, legal, tax, health and safety or insurance laws as do other accommodation providers, e.g. hotels. Having such activities operate outside of the regulatory umbrella not only exposes renters and rentees to risk but creates an uneven playing field, which can have significant ramifications on our communities and economy.

For example, visitors who choose Greater Victoria as a destination often do so as the result of the coordinated and ongoing efforts of the accommodation sector as well as tourism-related organizations such as Tourism Victoria.

The Municipal and Regional District Tax (MRDT) provides funding for local tourism marketing, programs, and projects. The tax is intended to help grow BC revenues, visitation and jobs, and amplify BC's tourism marketing efforts in an increasingly competitive marketplace.

The MRDT is an up-to-three per cent tax applied to sales of short term accommodation in participating areas of British Columbia including Victoria. In essence, local short term residential rental providers are getting a “free ride”.

Because short term residential rental transactions are hidden, there is no accurate estimation on the amount of MRDT revenues lost. Provincially, conservative estimates suggest upwards of $3 million in MRDT is being lost, which affects those communities such as ours that rely on MRDT marketing dollars to support our tourism industry, which generates billions in economic impact and employs over 22,000 people.

Short term residential rentals are inevitable. They need to operate safely and compete fairly within Greater Victoria. Short term residential rentals can co-exist with traditional accommodation providers to support local business, create jobs and attract external investment.

Now is the time for the Province of BC to modernize relevant legislation, bringing short term residential rental providers under its umbrella.

- Catherine Holt is the CEO of the Greater Victoria Chamber of Commerce. She can be reached at 250.383.7191 or CEO@victoriachamber.ca. www.victoriachamber.ca.

Published in Victoria Business Examiner January 2017

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