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London city committee votes to investigate applying 4% hotel tax to AirBnB

London city committee votes to investigate applying 4% hotel tax to AirBnB - image
Chesnot / Getty Images

The sharing economy was on the agenda at London city hall Tuesday.

City politicians on London’s community and protective services committee voted 6-0 in favour of not licensing AirBnB in the city, however city hall still decide to impose a tax on visitors to London.

Ward 10 Coun. Virginia Ridley argued there are enough regulations already.

“We have enough regulations currently in place to address concerns. If there’s a party, if there are noise issues, if there are those concerns, we have bylaws that would allow those to be addressed,” she said.

READ MORE: London city hall may soon consider taxing and licensing for AirBnb

The committee voted 4-2 to have city staff investigate whether the recently created 4% hotel tax should apply to AirBnB as well.

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Mayor Matt Brown and councillors Maureen Cassidy, Mo Salih and Bill Armstrong voted in favour of staff looking into that possibility, councillors Ridley and Phil Squire voted against it.

Squire, who says he has used AirBnB in the past, says the two-way rating system is a bonus.

“If you turn out to be a bad customer that’s quickly sort of marked and you won’t be accepted much longer. Similarly, people aren’t going to go to an AirBnB that isn’t clean and quiet.”

READ MORE: Tourism London pressing for action on proposed hotel tax

London city council created the tax for hotel and motel visits to the city in January. Revenue from the tax would be split between the city and Tourism London, each standing to collect between $1 million and $2 million.

Earlier this week, Canada’s hotel industry called on government to impose taxes on AirBnb services similar to hotels.

A staff report found there are 400 active AirBnB hosts in London. The average host makes $4,200 a year, rents out their home or room 73 nights a year with guests staying on average four nights at a time.

47% of the listings in London are for homes, 51% are for private rooms and 2% are shared rooms.

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READ MORE: Canada’s hotel industry calls on government to impose taxes on Airbnb services similar to hotels

The committee also reviewed a report looking at London’s ride-sharing by-law after one year.

Between April 2017 and March 2018 4.2 million rides were provided in London, 2.3 million were by taxi and limousine rides while 1.9 million were Uber rides. There were also 33,000 accessible rides provided.

While taxi’s gave the majority of the rides over the last year, there are twice as many Uber drivers as taxi drivers in London.

Over the first year of the bylaw there were 3,150 licensed Uber drivers compared to 1,123 licensed taxi and limousine drivers.

London’s bylaw boss Orest Katolyk says there are also 28 taxi drivers who moonlight for Uber.

City staff will now consult with drivers and report back to city politicians at a later date regarding potential changes to the bylaw. A public participation meeting will also be held at that time.

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