What's Happening?
The City of Charlottetown has announced an increase in its tourism levy, set to take effect at the start of 2026. The levy will rise from three percent to four percent, impacting short-term rentals, bed and breakfast units, and hotels. This decision was proposed by members of the tourism industry and approved by the city council. The funds collected from this levy are distributed among Discover Charlottetown, Meet P.E.I., and the Special Events Reserve Fund, which are responsible for promoting events, conferences, and tourism in the city. The increase is expected to generate an additional $600,000 in revenue, which will be used to enhance marketing and advertising efforts. John Cudmore, general manager of the Holman Grand Hotel and chair of the Hotel Association of Prince Edward Island, expressed support for the increase, citing rising costs in marketing and advertising as a driving factor.
Why It's Important?
The increase in the tourism levy is significant for Charlottetown's economy as it aims to bolster the city's ability to attract visitors and host events. The additional funds will enhance the city's competitive edge in the business event and conference sector, which is crucial for economic growth. Susan Freeman, executive director of Meet P.E.I., highlighted the importance of increased funding to remain competitive in attracting business events. The levy ensures that the financial burden does not fall on Charlottetown residents, as it is funded by visitors. This strategic move is expected to sustain and potentially increase tourism, which has been a vital component of the local economy.
What's Next?
With the levy increase set to take effect in 2026, stakeholders in the tourism industry will likely focus on optimizing the use of the additional funds to maximize the impact on tourism growth. The city may see an increase in marketing campaigns and promotional activities aimed at attracting more visitors. The success of these initiatives will be closely monitored by the city council and tourism organizations to assess the effectiveness of the levy increase in achieving its intended goals.
Beyond the Headlines
The decision to increase the tourism levy reflects a broader trend of cities leveraging visitor contributions to fund local economic initiatives. This approach aligns with global practices where tourism levies are used to support infrastructure and promotional activities without burdening local taxpayers. The move also underscores the importance of adapting to changing economic conditions and maintaining competitiveness in the tourism sector.
