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Tourism Industry Update: Municipal & Regional District Tax Program (MRDT)

Last year the BC Government changed the Municipal Regional District Tax (MRDT) rules so that short-term rental accommodations with one to three rooms are now required to register to collect and submit PST (8%) and MRDT (2% on the Sunshine Coast).

The MRDT is an up-to three percent tax applied to sales of short-term accommodations provided in participating areas of British Columbia on behalf of municipalities, regional districts and eligible entities. The MRDT is jointly administered by Ministry of Finance, Ministry of Tourism, Arts and Culture, and Destination BC. To promote a coordinated and efficient use of funds, the following MRDT program principles have been adopted:

  • Effective tourism marketing, programs, and projects
  • Effective local-level stakeholder support and inter-community collaboration
  • Coordinated and complementary marketing efforts to broader provincial marketing strategies and tactics
  • Fiscal prudence and accountability

As the ‘designated recipient’ of the MRDT funds, Sunshine Coast Tourism (SCT) will guide its stakeholders through the process to ensure everyone has accurate information around this funding program. Strategic planning and a coordinated effort will help determine an efficient use of the funds for the benefit of the entire region.

10 Things You Should Know About Short-Term Rental Accommodations And The MRDT

  1. The Municipal and Regional District Tax (MRDT) program was originally introduced in 1987 to generate marketing funds for a destination or region. Municipalities, regional districts or eligible entities can impose a tax of up to three percent (2% on the Coast) on the purchase of accommodation in specific geographic areas of the province (designated accommodation areas)
  2. The provincial government’s 2018 Budget changed the rules so all accommodations operating within the tax jurisdictions of the Powell River Regional District or the Sunshine Coast Regional District (and the municipalities within) are required to collect and remit the MRDT (2%) and PST (8%)
  3. As a result of the new rules, affordable housing was added as a permissible use of the additional funds collected by Online Accommodation Platforms (OAP) such as Airbnb. The collected funds are subject to reporting requirements by Sunshine Coast Tourism (SCT) which is the ‘designated recipient” for the Sunshine Coast region.
  4. In order for the funds to be considered for affordable housing, all local Sunshine Coast government bodies are required to discuss, prepare and present a regional plan to SCT.
  5. Once a regional plan is agreed upon, SCT will submit an Affordable Housing MRDT Plan which will be reviewed by the Ministry of Municipal Affairs and Housing prior to implementation of affordable housing initiatives. Communities will also be required to report out annually.
  6. General MRDT revenues (revenues from traditional accommodation providers, such as hotels, motels, etc.) cannot be used for affordable housing initiatives, unless Sunshine Coast Tourism submits a complete application demonstrating the support of tourism stakeholders and accommodation providers.
  7. The change in rules was effective last October 1, 2018. The first quarterly instalment of short-term rental or Online Accommodation Platform (OAP) funds are expected in Spring 2019, therefore the amount collected for one year is yet to be determined.
  8. As the funds are received, they will be placed in a special account to accumulate until a plan has been presented and approved by Sunshine Coast Tourism.
  9. The next opportunity for Sunshine Coast Tourism to include proposals for the use of the additional funds is in the 2020 MRDT One Year Tactical Plan.
  10. The Sunshine Coast Tourism membership fee is waived for all businesses that collect the MRDT, but you must sign up and opt in to receive news and to take advantage of several membership benefits. Membership provides people with an opportunity to participate, collaborate and unify all efforts to create a sustainable tourism economy on the Sunshine Coast. To sign up for membership visit: https://sunshinecoastcanada.com/corporate/membership/

For more information about the Municipal and Regional District Tax (MRDT) program please visit: