Airbnb will begin collecting taxes on its 1,700 Saskatchewan listings next month.
The company has finalized a tax agreement with the Government of Saskatchewan that will allow the company to collect and remit the six per cent PST on behalf of its hosts in the province as of April 1.
“I think that is indeed fair, in particular, to those who are renting hotel rooms and such — our hospitality industry,” Saskatchewan Finance Minister Donna Harpauer told reporters Tuesday.
Regina bed and breakfast owner Rick Urbanski, who has operated the Dragon’s Nest in Regina’s Cathedral neighbourhood for more than 15 years, said this is an important first step and one he’s been pushing for.
He said the online marketplace, on which he has posted one of his rooms, has significantly affected business.
The province has been losing the PST revenue it used to make off the Dragon’s Nest, according to Urbanski, who suggests the bookings have been going to Airbnb hosts, who have not been subjected to the taxation.
Urbanski, who has taken such a hit is now seeking longer-term tenants, said the city needs to step in with more regulation as well.
Saskatchewan Hotel and Hospitality Association president Jim Bence agrees.
“From a provincial perspective, applying PST levels the playing field,” he said in an interview with Global News. “From a municipal level, this is where cities need to do the same thing. They need to follow the province’s lead.”
In Regina last year, there were more than 500 listings, according to Airbnb. In Saskatoon, there were around 650. Both cities are currently considering legislating short-term rentals.
The company’s deputy director of public policy, Nathan Rotman, said having the PST agreement in place legitimizes Airbnb’s operations in Saskatchewan, in a sense.
He said Airbnb is actively discussing licensing with both Regina and Saskatoon.
“Both cities are unique and have kind of unique needs,” Rotman said.
Airbnb will automatically collect and remit the taxes to the government on all of the service’s bookings.
Harpauer does not know how much additional revenue the government will earn.
With more than 70,800 guests staying in Saskatchewan Airbnbs last year, hosts made a cumulative $9 million.
To date, Airbnb has partnered with more than 500 governments internationally, including British Columbia, Quebec and a number of municipalities in Ontario.
PST collected during the first 12 months of the tax agreement between Airbnb and British Columbia brought in nearly $34 million.