Niagara Falls

Nelson Sergerie, LJI Journalist

NIAGARA FALLS, Ont. – A five-day stay for a family in Niagara Falls could cost around $200 in various tourist fees, which help fund the infrastructure and activities of Canada’s tourism capital.
Every year, approximately 14 million tourists visit the famous falls, but the Niagara Falls Tourism Office refuses to disclose its operating budget, instead referring inquiries to the City.

The Municipal Accommodations Tax (MAT) is a mandatory tax imposed by the city council on the purchase of short-term accommodations for a continuous period of 28 days or less in hotels, motels, inns, bed and breakfasts, and vacation rentals in the city of Niagara Falls. It has been in effect since 2019.

The purpose of the MAT is to support and develop the tourism industry in Niagara Falls and improve the quality of life for city residents.

The objectives of the tax include, but are not limited to, increasing tourist visitation; increasing total tourist spending; increasing the development of tourism assets and tax assessment; and undertaking environmental sustainability initiatives to support the tourism industry and the broader community.
In 2017, Ontario passed a law allowing municipalities to impose a hotel tax.

Since June 1, the rate has been set at $4 per night for a two-star establishment and to $7 per night for a five-star establishment. Unrated properties are required to charge $5 per night. Initially, the tax was set at $2, regardless of category. Beginning in April 2026, the MAT will be converted to 4% of the accommodation bill.

The MAT must be clearly listed on the guest’s receipt or invoice.

In addition, the tourism office adds that, as in other tourist cities around the world, some hotels may charge additional hotel or resort fees to cover ancillary services. Some businesses may also charge additional service fees. Businesses are allowed to set their own prices and add discretionary service fees. The amount charged must be communicated to the potential customer in advance and not presented as a “tax.”

As prices and service charges are determined individually by each business, these charges may vary. Ontario businesses are required to comply with the Ontario Consumer Protection Act, which covers these requirements.

Niagara Falls Tourism specifies that it is not responsible for setting prices, processing, or collecting service charges.

In addition, parking is subject to a fee: the cheapest lots start at $10 and are located some distance from the main tourist attractions. The closer you get to the attractions, the higher the rate, up to $35 per day for covered parking.

In addition, there is an efficient public transportation system that allows visitors to visit all the sites between the large parking lot west of the city and Niagara-on-the-Lake, a historic resort area. Along the way, there are many vineyards and fruit growers, including Ontario peaches.

One thing is noticeable when tourists visit Niagara Falls. The restrooms are very clean and odor-free. No trash cans overflow at any time of day, despite a constant influx of tourists. The tourist infrastructure is in excellent condition, clean, and the staff—even the students—are courteous and smiling.

Several new activities are offered to tourists who visit the tourist destination fairly regularly.
The Niagara Falls Finance Department reports that it has collected $4,017,272.04 with the measure for the 2024 fiscal year. It is again specified that the money is used to promote tourist activities.

A contrast with Percé

However, the principle of the tourist tax sparked considerable debate in Percé.

It was introduced on May 1, 2022, but the court ruled it illegal in June 2023 on the grounds that it did not comply with the enabling powers prescribed by the Cities and Towns Act relating to municipal taxes.

The court concluded that the framework allowed a municipality to enter into an agreement to appoint a third party as tax collector, but that this role could not be imposed, which exceeded the powers granted.

Percé had initiated proceedings in the Court of Appeal, but the council withdrew in June 2024.
Following the July 1 council meeting, Mayor Daniel Leboeuf stated that he had not received any feedback from groups of merchants, hoteliers, or restaurateurs who wanted to propose alternatives to the tax as it was proposed.

He pointed out that Percé devotes a significant portion of its budget to hospitality and infrastructure, asserting that the industry must do its part.