Municipal Accommodation Tax (MAT) - Frequently Asked Questions

Mayor and Members of Council approved the MAT, for hotels and motels, on January 29, 2019. MAT will be implemented at hotels, motels and bed and breakfasts across the city effective April 1, 2019.

Council approved the Municipal Accommodation Tax Short-term Rental By-law 183-2019 at the meeting of December 17, 2019. All short-term owners and brokerages must register for a MAT ID in order to obtain their license to run their short-term rental. The collection of the MAT for these types of properties will begin April 1, 2020. To learn more, visit Short-term Rentals.

Vaughan has set the rate at four (4) per cent, consistent with other jurisdictions in Ontario.

MAT is a mandatory charge that would be included in the accommodation payment at the time of booking with the hospitality operator.

In total, 16 municipalities. In the Greater Toronto Area (GTA), Municipal Accommodation Tax by-laws have been passed in cities such as Toronto, Mississauga, Markham and Oakville.

No. This tax will only be paid by visitors making accommodation bookings at Vaughan-based hotels, motels, bed and breakfast, and short-term rental accommodations.

Tourism is an important employment and economic driver in the City of Vaughan. The MAT enables the City to increase investment in tourism marketing without further contributions from local taxpayers.

While the MAT will now be applied to short-term rentals, including those on Airbnb and other online platforms, college/university dorm rooms, hospitals, long-term care facilities, shelters and accommodations rented for less than four hours or more than 29 consecutive nights are exempt from the legislation.

No. MAT is only applied to a room that is being used for accommodation. However, it is exempt when a room, that may or may not contain a bed, is being used for displaying merchandise, meetings or entertainment and not being used for accommodation. MAT is also not applicable to services such as laundry services, valet parking, meals, etc. Please see the Ontario Legislation and Ontario Regulation regarding transient accommodation tax.

The following exemptions apply to the MAT:

• Accommodations that are rented for a period of more than 29 consecutive nights
• Accommodations that are provided on a property owned by the Crown or was forfeited to the Crown
• Accommodations that are paid for by employees of the Crown receiving a "government rate" for the accommodation
• Accommodations that are provided in a property owned by a School Board as defined in the Education Act
• Accommodations that are paid for by employees of the School Board receiving a "school board rate" for the accommodation
• Lodgings provided to students by a university, college or post-secondary while the student is registered at and attending the institution
• Hospital referred to in the list of hospitals and their grades and classifications maintained by the minister of Health and Long-Term Care under the Public Hospitals Act and every private hospital operated under the authority of a license issued under the Private Hospitals Act
• Long-term care home as defined in subsection 2(1) of the Long-Term Care Homes Act, 2007, retirement home and hospices
• Accommodations provided as shelter
• Treatment centers that receive provincial aid under the Ministry of Community and Social Services Act
• House of refuge, or lodging for the reformation of offenders
• Charitable, non-profit philanthropic corporation organized as shelters for the relief of the poor or for emergency
• Tent or trailer sites supplied by a campground, tourist camp or trailer park
• Accommodation supplied by employers to their employees in premises operated by the employer

In communities such as Vaughan where a destination marketing organization does not exist, the transient accommodation tax under the Municipal Act, 2001 requires municipalities that choose to implement a transient accommodation tax to share a portion of their revenues from the tax with an “eligible tourism entity.” In Vaughan, 50 per cent of income collected from MAT will be used to fund destination marketing in the City. The remaining 50 per cent will be used for city-building initiatives.

The City completed a market assessment of the MAT to derive an estimate on potential revenues from hotel/motel and short-term accommodation sources. The assessment concluded that the City of Vaughan could receive $3.3 million annually and growing, subject to economic conditions.

Yes. The accommodation provider is responsible for collecting and remitting the HST on the entire charge, including the MAT however, it is suggested to contact the Canada Revenue Agency to confirm this information.

If the accommodation was booked and paid for prior to the implementation date (April 1, 2020 for short-term rental accommodations), the tax will not be applicable. If it was booked before April 1, but paid for on April 1 or onwards, the tax is applicable.

The tax must be charged beginning April 1 only (short-term rentals April 1, 2020). Any nights prior to April 1 should not be charged the MAT.

The MAT will be collected and remitted even if the guest is a no-show and has been charged for the accommodation in partial or full. If the MAT is charged to an invoice that was paid by a guest but was subsequently issued a full or partial refund on that accommodation charge, the guest should also be refunded the applicable amount. If the refund occurs after you have remitted the MAT, accommodation providers can adjust the MAT submission the following month, making note in the adjustment box on the Remittance Form.

You must complete the Municipal Accommodation Remittance Return Form indicating revenue and MAT collected for the reporting period and remit payment to the City. This is completed even if there is no revenue to report and MAT was not collected.

Section 400.1 of the Municipal Act, 2001, S. O. 2001, c.25, provides that the council of a local municipality may pass by-laws imposing a tax in respect of the purchase of transient accommodation within the municipality. 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 force December 1, 2017 allowing single-tier and lower-tier municipalities to levy a Municipal Accommodation Tax.