While we recognize the fiscal pressures facing the Government of Alberta, the increase of the Tourism Levy to 6% in Budget 2026 highlights the need for greater transparency and accountability in how the levy is applied and used.
Introduced in 2005 to replace the Hotel Room Tax, the Tourism Levy was designed as a partnership between government and industry to support tourism marketing and development. Since then, hotels have carried the responsibility of collecting and remitting the levy - covering administrative burdens and additional credit card fees that reached an estimated $2.8 million in 2024 and could rise to roughly $4 million with the increase.
Despite its name, the levy functions as a hotel sales tax, with revenues flowing into general government revenue. Budget 2026 projects about $200 million in levy revenue, yet only 40% is directed to Travel Alberta. If hotels are required to collect this tax, the funds should support their original purpose: growing Alberta’s visitor economy.
The increase also highlights ongoing inequities in Alberta’s accommodation landscape. While hotels operate under extensive regulation and taxation, commercial short-term rentals continue to operate without oversight.
We have written to Premier Danielle Smith to express your concerns. You can read our letter HERE.