Thank you. Mr. Thompson.
Thank you, Mr. Chair. I guess I'm just disappointed. It's either or all. If you're going to exempt the GNWT, then we could be exempting all residents of the Northwest Territories. It's a tourism tax; that's what I am reading. It says tourism accommodation tax; that's what it is. So you mean that, for our sporting teams, they're now considered tourists coming into the capital to participate? Can the Minister please elaborate on that? Thank you, Mr. Chair.
Thank you. Minister.
Thank you, Mr. Chair. As I mentioned, we did do the consulting and met with all our stakeholders, and we did try to strike a balance with the various exemption scenarios. This what we came up with. This is a tourism tax that would be for Yellowknife municipalities, for the City of Yellowknife and not for the GNWT. Thank you, Mr. Chair.
Thank you, Minister. Mr. Thompson.
Thank you, Mr. Chair. Ms. Green talked about consulting and you went out and talked to the groups and came up with this recommendation, but it was the GNWT that made that recommendation; it wasn't the group of people you were talking to. So why did the GNWT make that recommendation? They didn't hear it from any of the people out there. They heard it from the Government of the Northwest Territories. So can you please explain why the Government of the Northwest Territories was able be part of this without telling people they were going to be consulted? Thank you, Mr. Chair.
Thank you. Minister.
Thank you, Mr. Chair, and I did mention just early on in the questioning here from the Member that GNWT decided early on that it will not choose to tax itself when it's not collecting revenue to offset those costs. Thank you, Mr. Chair.
Thank you. Less than a minute. Mr. Thompson.
Thank you, Mr. Chair, and I apologize. I took the whole 10 minutes. I was hoping not to.
The GNWT decided that they are not going to tax themselves, but we are going to tax the residents of the Northwest Territories with this fee. Is that what you are telling me? Thank you, Mr. Chair.
Minister.
Thank you, Mr. Chair. The bill allows for a municipality to choose to implement this tax. GNWT is not putting the tax on people. It is up to the municipality. As you have heard before, we have five other taxbased communities that decided not to do this, and we have one municipality that has decided to put this through, should this bill get assent. Thank you, Mr. Chair.
Thank you, Minister. Mr. Thompson, your time has expired. I have no one further on my list, so we will move to a clausebyclause review of the bill.
Committee, we will defer the bill number and title until after consideration of the clauses. Please turn to page 1 of the bill. I will call out the clauses. After I call out the clause, if committee agrees, please respond accordingly. Are we ready?
Agreed.
Thank you, Mr. Testart. Clause 1.
Agreed.
Thank you. Clause 2. Mr. Thompson.
Thank you, Mr. Chair. A motion to Amend the Cities, Towns and Villages Act, that clause 2 of Bill 18 be amended by deleting proposal subclause 70.1(5) and substitute the following: (5) tourism accommodations tax must not be imposed under this section if the subject of the tax is a resident of the Northwest Territories. Thank you, Mr. Chair.
Thank you, Mr. Thompson. A motion has been made. It is being distributed. It has been distributed. The motion is in order. To the motion, Mr. Thompson.
Mr. Chair, clause 2 of Bill 18 adds a new section to the Cities, Towns and Villages Act that allows tax-based municipalities to levy a tax on tourism accommodations. Under clause 2, the new section 70.1(5) provides a list of exemptions, that is, a list of types of accommodations or classes for the persons and organizations who may be exempt from paying the tax. These include accommodations rented for more than 30 days, accommodations costing less than $20 per night, the Government of the Northwest Territories and its public boards and agencies, a person and his or her family being accommodated on medical travel, a person paying out of pocket for a stay at the hospital or health care facilities, or any other exemptions provided that are in the regulations.
During review, the standing committee heard from the majority of the public that the list of exclusions is too long. The City of Yellowknife, who is the primary proponent of the bill, said the City would prefer that Bill 18 not contain such an exhaustive list of exclusions. The Explorer Hotel expressed concern about the burden that the exclusions would place on front-line staff to determine eligibility for exclusions. This is important because the bill contemplates the designation of a hotel operator as a tax agent for the municipality. The Explorer Hotel said it will be difficult for a front desk worker or reservation agent to challenge a government official as to the purpose of their trip.
Mr. Chair, during the clausebyclause review of the bill, committee moved a motion to amend this provision by deleting the list of exclusions and replacing it with a single exclusion for all NWT residents. Unfortunately, the Minister did not concur, and the motion was defeated. I bring forward this motion again, and I support it for two reasons.
First, it simplifies administration of the tax for hotel operators. Anyone who pays for accommodations and can show proof of NWT residence using any government-issued ID card would be exempt.
Secondly, this is meant to be a tax on tourists travelling to the Northwest Territories. The NWT is already an expensive place to live and work, and I do not feel that it is fair to tax NWT residents in this way to support a municipal tourism objective. I am worried about the impact of adding this additional cost on local governments travelling to Yellowknife for meetings and training. These local governments are already underfunded annually by the GNWT to the tune of more than $30 million per year. I am also especially worried about the potential negative impact of this levy on amateur sport teams, who scrimp and fundraise for every dollar that they can get in order to travel to sporting events.
For these reasons, I support this motion today and ask for the support of my colleagues in the south. Thank you, Mr. Chair.
Thank you, Mr. Thompson. To the motion. Mr. Testart.
Thank you, Mr. Chair. Mr. Chair, I appreciate where the Member is coming from. I know many Northerners are constantly concerned about the ever-increasing cost of living, especially those in small communities.
However, what these amendments were designed to do is to empower cities, towns, and villages to implement taxes to support tourism opportunities in their communities. When the standing committee consulted with all of the six cities, towns, and villages that would be subject to these new bylaw provisions, the vast majority of them spoke in favour of the City of Yellowknife being allowed to do this.
My concern is, if we bring forward this kind of blanket exemption, we already know that the current list of exemptions is going to eat up 30 to 40 percent of the current taxes. An allNWT exemption is going to further erode the tax revenues and potentially make this amendment pointless in terms of its design, which is to provide the City of Yellowknife with muchneeded resources to support tourism operations and a thriving tourism economy.
Again, I appreciate where the Member is coming from. The municipalities are able to offer their own list of exemptions. This is something that a sports organization or a financial organization with limited resources could potentially negotiate with the City of Yellowknife. My understanding, as well, is that the hoteliers often provide discounted room rates to sports teams or other charity organizations.
I think there is goodwill in the community to support people with limited resources, and I don't think that we need to put this broad an exemption in place, because, again, I think it will defeat the purpose of the motion, make it a moot point, and send the City of Yellowknife, who has worked very hard bringing this forward, worked very hard with their colleagues in the NWTAC, and bring them back to square one in finding new revenues for tourism.
I can't support this amendment, and I encourage my colleagues who have looked over our reports to do the same. Thank you.
Thank you, Mr. Testart. To the motion. Minister Moses.
Thank you, Mr. Chair. Mr. Chair, I cannot support the motion. Currently, Bill 18 provides an exemption for the Government of the Northwest Territories and individuals on medical travel. It also provides an exemption for persons staying in accommodation for more than 30 days in a row for less than $20 night. The substantial amendment proposed by SCOGO would eliminate these exemptions and instead include an exemption for all residents of the Northwest Territories.
The exemptions included in Bill 18 were researched and analyzed prior to including them in the legislative proposal and formed a key component of our department's consultation with the community governments for which these amendments will apply. The exemptions included in the bill strike a balance of the input received through our stakeholder consultation and reflects an approach that all stakeholders can support.
Through our market analysis, we found that reliable data on the different types of hotel stays was not available. I therefore cannot support changes to the legislation without fully understanding the intended and unintended consequences of the changes to the exemptions.
Finally, but most importantly, MACA has worked very closely with community governments throughout the development of this legislative initiative. To change the provisions of the bill in this manner at this late stage without their involvement does not support our process on partner engagements. Thank you, Mr. Chair.
Thank you. To the motion, recognizing that we have six and a half minutes here. Mr. McNeely.
Thank you. That provides me seven minutes here to finish. No, excuse me.
Based on the survey numbers, we are targeting 108,000 visitors and excluding everybody else. For that simple reason, and as I mentioned earlier, I will support this amendment. Thank you.
Thank you. Ms. Green.
Thank you, Mr. Chair. Mr. Chair, Yellowknife is a tax-based community that is trying to enhance its own economy. This tourism levy is one of the means to do that, and to create its own revenue stream separate from the GNWT.
The City of Yellowknife is not generously funded by the GNWT. There is a substantial underfunding situation there. They need the ability to raise tourism levies for their own tourism marketing and economic sustainability. I do not support the motion.
Thank you, Ms. Green. To the motion. Mr. Testart.
Thank you, Mr. Chair. I move, pursuant to Rule 6(2) of the Rules of the Legislative Assembly, that the Committee of the Whole continue to sit beyond the daily hour of adjournment for the purpose of continuing consideration of Bill 18, An Act to Amend the Cities, Towns and Villages Act. Thank you, Mr. Chair.
Thank you, Mr. Testart. There is a motion on the floor. The motion is in order and non-debatable. All those in favour? All those opposed?
---Carried
We will sit beyond 6:00 p.m. to conclude this item. To the motion.
Question.
Question has been called. Mr. Thompson, after the mic was off, I believe I heard you ask for a recorded vote. Could you please say that on the record? Mr. Thompson.
Thank you, Mr. Chair. Yes, I would ask for a recorded vote. Thank you.
The Member for Nahendeh and the Member for Sahtu.
All those opposed, please rise.
The Member for Frame Lake, the Member for Yellowknife Center, the Member for Deh Cho, the Member for Nunakput, the Member for Inuvik Boot Lake, the Member for Range Lake, the Member for Great, the Member for Yellowknife South, the Member for Inuvik Twin Lakes, the Member for Hay River South, the Member for Thebacha, the Member for Yellowknife North, the Member for Kam Lake.
All those abstaining, please rise. The results of the recorded vote: two in favour, 13 opposed, zero abstentions. The motion is defeated.
---Defeated
Clause 2. Does committee agree?
Agreed.
---Clauses 1 through 6 inclusive approved
Clause 7.
Agreed.
Mr. O'Reilly.
Thanks, Mr. Chair. I do have a couple of questions I want to ask on clause 7 about the regulation-making authority. I want to know whether it's the intention of the Minister to bring forward any regulations with regard to expanding the exclusions as set out under the Act. Thanks, Mr. Chair.
Thank you. Minister.
Thank you, Mr. Chair. Yes, if you go back to subparagraph, subsection (5), CV, clause 2, it allows for further exemptions to be prescribed by regulation. The regulation making authority is given to Cabinet. Thank you.
Thank you. Mr. O'Reilly.
Thanks, Mr. Chair. Is there any intention then on the part of Cabinet to broaden the exclusions that are set out in the Act using regulations? Is there any intention to do that at this time? Thanks, Mr. Chair.
