Hotel And Lodging Tax In British Columbia 2026: MRDT Rates By City

How British Columbia's Hotel and Lodging Tax Works

British Columbia does not have one single "hotel tax." Instead, a stay at a BC hotel, motel, resort, bed and breakfast, or short-term rental is subject to two provincewide taxes, the 5% federal Goods and Services Tax (GST) and the 8% Provincial Sales Tax (PST), plus an optional local layer called the Municipal and Regional District Tax (MRDT) that only applies where a municipality, regional district, or eligible tourism association has specifically been designated to collect it.

The PST is authorized under the Provincial Sales Tax Act (SBC 2012, c. 35) and applies to "short-term accommodation," defined broadly enough to cover hotels, motels, resorts, B&Bs, condominiums, vacation homes, cabins, and even ships or trains used as lodging, along with entire or partial residential dwellings. The MRDT is authorized under section 123 of that same Act. Unlike PST, MRDT is not automatic: a municipality or regional district has to apply to the province, through a process coordinated by Destination BC and approved by the Ministry of Finance and Cabinet, before it can start collecting the tax in its area. As of 2026, more than 60 municipalities, regional districts, and sub-regional areas across BC have been designated to collect MRDT, each at a rate the province has approved for that specific area, generally 2% or 3%.

Because MRDT is area-specific rather than provincewide, two BC properties an hour apart can face meaningfully different total tax loads: one might sit in a non-participating area and owe only 13% (GST plus PST), while another in a 3% MRDT zone owes 16%. Vancouver adds a further wrinkle with its Major Events MRDT, discussed below. Revenue collected through MRDT is earmarked for local tourism marketing, tourism-related infrastructure, and, since a 2018 provincial budget change, affordable housing initiatives aimed at tourism workers, and is not simply added to a municipality's general tax revenue.

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Tax Rates and Extra Fees

The table below breaks out each component that can appear on a BC accommodation bill and explains where it comes from.

The Major Events MRDT is a separate, time-limited charge, not a renamed or increased version of the standard MRDT. A property in Vancouver shows both the regular 3% MRDT and the additional 2.5% Major Events MRDT as distinct line items, and because the combined 13.5% pushes past the federal 12% specified-tax-rate threshold, GST also calculates on top of that combined provincial and municipal tax too, not just on the room rate. That stacking effect does not occur anywhere else in BC, since no other municipality currently combines a base MRDT with the Major Events MRDT.

A separate, non-government charge sometimes appears alongside these taxes: some Victoria-area hotels add a voluntary Destination Marketing Fee of around 1% to fund tourism promotion. That fee is set by the individual hotel or a local hotel association, not by the province or a municipality, and is not part of the MRDT program.

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Collection and Remittance

Guests pay GST, PST, and MRDT at checkout as part of the accommodation charge. The accommodation provider, whether a hotel, a B&B, or an individual short-term rental host, is legally responsible for collecting and remitting those taxes to the province through the same eTaxBC system used for general PST, filing separate PST and MRDT returns but able to submit a single combined payment.

Three different bodies share responsibility for the MRDT program, and no single one of them does everything. Destination BC is the first point of contact for a municipality applying for MRDT status and reviews the tactical tourism-marketing plans and annual reports that participating areas must submit, but it does not collect tax, approve applications on its own, or enforce compliance. The Ministry of Finance handles the actual tax collection, disbursement of MRDT revenue back to municipalities, and enforcement, and it makes the final recommendation to Cabinet on new or changed MRDT designations. The municipality, regional district, or eligible tourism association that applied for MRDT status receives the collected revenue and reports annually on how it was spent.

Filing frequency (monthly, quarterly, semi-annual, or annual) is assigned when a business registers, based on how much PST it collects per year; businesses collecting more than roughly $12,000 in PST annually are typically assigned monthly filing. A nil return is required for every assigned period even when no taxable sales occurred, and this applies to MRDT returns as well as PST returns.

Online booking platforms are not passive here. Since July 1, 2022, BC law has required "online marketplace facilitators," a category that covers Airbnb, Vrbo, and similar platforms, to register and collect and remit both PST and MRDT on bookings made through their platforms, following on from Airbnb's earlier voluntary agreement with the province starting in 2018. An accommodation provider who lists on a facilitator platform but also takes direct bookings through their own website still has to register separately and handle tax on those direct bookings themselves; sellers remain jointly and severally liable if a platform fails to collect correctly.

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British Columbia's Fee Transparency Rules

There is no BC-specific all-in-pricing statute, but a federal rule now covers BC hotels directly. Bill C-59, which received royal assent on June 20, 2024, amended the federal Competition Act to explicitly prohibit "drip pricing," the practice of advertising a low base rate and then adding mandatory fees during checkout. Under this rule, any fixed, obligatory charge that isn't a tax imposed by the government, resort fees and mandatory service charges among them, has to be included in the price shown to a guest up front, not revealed only at the final booking step. Government-imposed taxes like GST, PST, and MRDT are specifically excluded from this requirement and can still be added at checkout, but a hotel's own mandatory fees cannot be held back the same way.

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Exemptions From British Columbia's Hotel Tax

The main exemption is length of stay: PST and MRDT stop applying once a guest is provided accommodation for a continuous period of 27 days or more at the same property. This is a specific BC number, not the 30-day threshold used in some other jurisdictions, and it counts from the point the stay becomes continuous, not retroactively for the whole booking from day one unless the full period was already contracted for 27 days or more.

A handful of accommodation types and buyers fall outside the tax base entirely rather than being "exempt" after the fact: certain not-for-profit and emergency shelter arrangements, and accommodation purchased directly by specific exempt government bodies, are treated as outside the definition of a taxable sale under the Provincial Sales Tax Act's general exemption rules, though these situations are narrow and property-specific rather than blanket carve-outs a typical commercial hotel would rely on.

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Common Mistakes Hotels Make With Tax Compliance

• Treating MRDT as a flat provincewide rate. MRDT only applies in designated areas the province has specifically approved, so a property outside a participating municipality or regional district should not be charging it at all.
• Assuming the long-stay exemption is 30 days. BC's threshold is 27 consecutive days to the same guest, and applying the wrong number either overcharges long-term guests or under-collects tax the hotel still owes.
• Missing Vancouver's GST-on-tax stacking effect. Because Vancouver's combined PST and MRDT (13.5%) exceeds the federal 12% specified tax rate, GST also applies to that provincial and municipal tax amount there, a calculation step properties outside Vancouver don't need.
• Assuming a listing platform handles every booking channel. Airbnb and Vrbo collect and remit PST and MRDT on bookings made through their platforms, but a property that also takes direct bookings through its own website or phone still has to register and remit on those bookings separately.
• Skipping nil returns. A PST or MRDT return is due for every assigned filing period even when a property collected zero tax that period, and missing a nil return can trigger the same penalties as missing a return with tax owing.
• Folding a voluntary marketing fee into the tax line. A Destination Marketing Fee charged by some hotels (Victoria-area properties, for example) is a private hotel or association charge, not a government tax, and listing it as if it were part of MRDT misrepresents the bill to guests.

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Where A PMS Fits Into Tax Compliance

None of this is about software until a property tries to configure it by hand across every room type and booking channel. British Columbia's tax load can vary by property location (whether MRDT applies at all, and at what rate), by length of stay (the 27-day cutoff), and, for Vancouver properties specifically, by a GST-on-tax calculation that doesn't apply anywhere else in the province. roommaster's PMS lets a property configure tax codes and rates per rate plan so the correct combination of GST, PST, MRDT, and, where relevant, Major Events MRDT applies automatically rather than being recalculated manually at the front desk, and its booking engine can display the full, all-in price up front, which matters now that federal drip pricing rules require mandatory charges to be disclosed before checkout rather than added at the end.

Frequently Asked Questions

1. Does British Columbia have its own hotel tax rate?

Not a single provincewide rate. British Columbia applies the same 5% GST and 8% PST everywhere, but the additional Municipal and Regional District Tax, up to 3%, only applies in specific designated municipalities and regional districts, so the total rate depends on where the property is located.

2. What is British Columbia's hotel tax?

In BC, "hotel tax" is an informal term covering three separate charges: 5% federal GST, 8% provincial PST, and, in participating areas only, up to 3% MRDT. There is no single line item on a BC bill labeled simply "hotel tax."

3. What is British Columbia's lodging tax?

"Lodging tax" refers to the same combination of GST, PST, and, where applicable, MRDT that applies to hotels, motels, resorts, B&Bs, and short-term rentals across the province. It is not a distinct fourth charge.

4. What is the MRDT in BC?

The Municipal and Regional District Tax is a tax of up to 3% that a municipality, regional district, or eligible tourism association can apply for and collect, with the revenue dedicated to local tourism marketing, tourism infrastructure, and tourism-worker affordable housing rather than general municipal spending.

5. How much is hotel tax in Vancouver compared to the rest of BC?

Vancouver charges the standard 3% MRDT plus an additional 2.5% Major Events MRDT through January 2030, bringing combined provincial and municipal tax to 13.5% before GST. Because that exceeds a federal 12% threshold, GST also applies to that 13.5%, a stacking effect that does not occur in cities without the Major Events MRDT.

6. Is there a long-stay exemption from BC's hotel tax?

Yes. PST and MRDT stop applying once a guest stays 27 or more consecutive days at the same property. GST generally still applies regardless of stay length.

7. Do Airbnb and Vrbo collect BC's hotel tax automatically?

Yes, for bookings made through those platforms. Since July 1, 2022, BC law has required online marketplace facilitators like Airbnb and Vrbo to register and collect and remit PST and MRDT on the bookings they process, though a host who also takes direct bookings outside the platform must handle tax on those separately.