SOMBA K'E/YELLOWKNIFE - The Yellowknife Hotel Association is recommending that the one per cent hotel tax it has been lobbying the GNWT for be specifically used to promote Yellowknife as a convention destination, though who exactly will administer the funds is up in the air.

Jenni Bruce, general manager of Chateau Nova and president of the Yellowknife Hotel Association, said six additional conferences in Yellowknife would bring $1.5 million in revenue to the city. - Guy Quenneville/NNSL photo

At last week's roundtable discussion on revenue options with the GNWT, the participants - who included Jenni Bruce, president of the hotel association, and Mayor Gord Van Tighem, also president of the NWT Association of Communities - voted unanimously that any legislated hotel tax should be undertaken at the discretion of individual municipalities.

The GNWT, in a discussion paper circulated before last week's meeting, had floated the idea of a territory-wide hotel tax. But workshop participants agreed that option would put business owners in small communities at a disadvantage, said Bruce.

"The main logic behind it is you've got certain municipalities that have got one motel," said Bruce. "It would be unfair to expect them to put in a levy when they're not going to hold these big conferences.

"So this is set up in legislation so that a municipality can choose to pick it up, or choose not to.

"...we're not wanting to force a tax on people that shouldn't have to pay it."

The same would go for lodges or other businesses that operate outside municipal boundaries, added Bruce.

"We don't think the lodges would get taxed at all. They would get a benefit from it, but it would be a minimal one, so we wouldn't expect investment from them."

What remains to be ironed out is what authority in Yellowknife will allocate the funds. "That is the part that is yet to be determined," said Bruce.

One option that was discussed during the workshop would see the City of Yellowknife collect the taxes, charge the Northern Frontier Visitors Association an administration fee, and then release the funds to the association. The association would then use the money to attract more conferences to Yellowknife.

According to the Yellowknife association, had the levy been in place in 2008, it would have generated $250,000 in revenue; in 2009, $200,000.

"With the recession and everything, this sector continues to thrive with no marketing," said Bruce.

The NWT Association of Communities voted last May to lobby the GNWT to legislate a hotel levy to be used by individual municipalities to market their communities to potential visitors.

The GNWT is inviting the public to provide comments on the proposed tax before it releases a summary report next month.

"It's too early for recommendations," said John Monroe, director of fiscal policy with the GNWT's department of finance.

We welcome your opinions. Click here to e-mail a letter to the editor.