Thunder Bay has issued a fresh reminder that owners of short‑term rentals must collect a five‑percent municipal accommodation tax (MAT) on stays under 30 days. City officials say roughly 60% of such operators are currently compliant, leaving a sizbale gap in revenue that funds local tourism and events.

Only 60% of short‑term rentals meet MAT obligations

According to Adam Carruthers, the city’s manager of licensing and enforcement, most hotels and motels already remit the tax,but a “significant number” of Airbnb‑style hosts have not. The city’s own estimate puts compliance among short‑term rental operators at about sixty percent, meaning nearly two‑thirds of eligible properties could be under‑reporting .

Five‑percent tax generated $5 million for 2025 tourism budget

The municipal accommodation tax has become Thunder Bay’s primary fiscal tool for tourism development. In the 2025 fiscal year, the five‑percent levy produced roughly five million dollars, which the city channels into events such as the Scotties Tournament of Hearts and other visitor‑drawn initiatives. As the report notes, lost revenue from non‑compliant rentals directly threatens the ability to sustain these programs.

Potential court action and fines for non‑compliant owners

City bylaws make it clear that failure to collect and remit the MAT can lead to legal proceedings and monetary penalties. carruthers warned that “non‑compliant propertties risk court proceedings and fines,” underscoring the city’s intent to enforce the rule uniformly across all accommodation providers.

Who remains outside the tax net?

The reminder does not identify specific non‑compliant listings, but the lack of granular data leaves open the question of which neighborhoods or property types are most likely to evade the tax. as the source reports, the city encourages prospective hosts to contact municipal authorities before launching a rental business, suggesting that many operators may be unaware of the requirement.

Why the city insists on a level playing field

Thunder Bay argues that equal treatment of hotels, motels, and short‑term rentals is essential for fair competition. by ensuring all providers collect the same five‑percent levy, the city aims to protect revenue streams that support tourism infrastructure and event hosting, which in turn benefits the broader local economy.