BC Hotel Tax: Combined Rate, Exemptions, and Platform Bookings

A hotel room or short-term stay in British Columbia is taxed in layers. The province charges 8% Provincial Sales Tax (PST) on the room, participating municipalities add a Municipal and Regional District Tax (MRDT) of up to 3%, the City of Vancouver adds a further 2.5% Major Events MRDT, and the federal government applies 5% Goods and Services Tax (GST). The BC hotel tax a guest actually pays therefore lands somewhere between 13% in a non-participating area and 18.5% in downtown Vancouver.¹

How the Combined Rate Breaks Down

Four separate taxes can apply to the same stay. Not every community charges every one of them.

Provincial Sales Tax of 8% on the purchase price of short-term accommodation, collected across the province.¹
Municipal and Regional District Tax of up to 3% in participating municipalities and regional districts. Rates vary by community, and some areas do not charge it at all. The Province publishes an interactive MRDT location map showing which areas participate and at what rate.¹
Major Events MRDT of 2.5%, charged only on stays within the City of Vancouver. This is a temporary tax running from February 1, 2023 through January 31, 2030 to help cover the cost of hosting major international events.¹
Goods and Services Tax of 5%, the federal tax that applies to short-term accommodation everywhere in Canada.²

In downtown Vancouver, the stack is 8% PST + 3% MRDT + 2.5% Major Events MRDT + 5% GST, which adds up to 18.5% on the room charge. In another MRDT-participating community such as Victoria or Kelowna, the total sits around 15% to 16%, depending on the local MRDT rate. In an area that does not participate in MRDT, a guest pays only the 8% PST and 5% GST, totalling 13%.¹ MRDT revenue is directed back to local tourism marketing and infrastructure through Destination BC and participating communities.³

What the Tax Is Calculated On

The taxable purchase price is not just the advertised nightly rate. It is the total amount a guest pays for the right to use the accommodation, including the extra fees providers tack on at checkout. A lot of charges that look like separate line items are rolled into the base for PST and MRDT.

Fees that fall inside the taxable purchase price include administration, booking, cleaning, credit card processing, extra bed or crib, extra linen, guest fees, pet fees, and resort fees.¹ If a short-term rental host lists a $150 nightly rate with a $75 cleaning fee and a $25 pet fee, the PST and MRDT are calculated on the full $250. The only amount excluded from the calculation is the federal GST itself.

What Counts as Taxable Accommodation

The Provincial Sales Tax Act defines taxable accommodation broadly. It covers lodging in a hotel, motel, resort, boarding house, rooming house, or bed and breakfast, along with lodging in any prescribed dwelling.⁴ That last category reaches short-term rental listings on digital platforms, vacation homes, cabins, and apartments rented for brief stays. A furnished space with working utilities, rented for a fee for under 27 days, almost certainly qualifies.

The definition applies whether the property is a dedicated rental or someone’s spare bedroom, and it does not matter how the guest found the listing or how payment was processed.

When Accommodation Is Exempt

Several categories of stay fall outside PST and MRDT. The exemptions most likely to affect a guest or a host involve long stays, cheap rooms, and First Nations purchases.

Stays of 27 Days or More

A continuous stay of 27 days or more in the same unit is exempt from PST and MRDT. Billing structure drives how the exemption works in practice. If the operator bills the guest for a period of 27 days or more upfront, no tax is charged from day one. If billing is in shorter intervals such as weekly, PST and MRDT are charged on each bill. Once the guest passes 26 continuous days, the operator stops charging tax on the remainder, and the guest can apply to the Ministry for a refund of tax already paid. The operator cannot issue that refund directly.⁵

Block bookings follow the same logic. If a company reserves 40 rooms but only 30 are held continuously for 27 days or more, tax applies to the 10 rooms that were not held the full period while the other 30 stay exempt. Employees can switch between rooms during the period without breaking continuity.

Low-Cost Lodging

Lodging priced at $30 or less per day, or $210 or less per week, is exempt from PST and MRDT. The exemption does not apply if the accommodation is listed on an online marketplace platform.¹ A budget motel charging $28 a night qualifies. A $25-per-night listing on Airbnb does not.

First Nations Purchases

First Nations individuals and bands are generally exempt from PST when purchasing accommodation on First Nations land for personal use. The purchaser must hold a valid Certificate of Indian Status card, and the seller must follow documentation procedures that include verifying the card photo, recording the registration number or band information, and obtaining a matching signature on the invoice.⁶ Citizens or members of a Modern Treaty Nation remain eligible even if their status card indicates otherwise.

Other Exempt Categories

Industrial camps providing housing for workers in remote locations sit outside the standard accommodation tax framework and are governed by separate labour-related housing rules. Non-profit organizations operating hospice or charitable housing may also qualify for relief.

Who Collects the Tax When You Book Through a Platform

When a stay is booked through a platform like Airbnb or VRBO, the platform is usually the one collecting and remitting PST and MRDT. Under BC’s online marketplace facilitator rules, a platform that contracts with hosts, facilitates bookings through its website or app, and collects payment from guests is responsible for the tax.⁷ For guests, this is why the tax lines appear on the platform’s receipt rather than a separate invoice from the host.

For hosts, platform collection means an individual host generally does not need to register for PST or collect the tax separately on those bookings.⁸ Direct bookings taken outside the platform are a different matter: the host is responsible for collecting and remitting tax on those stays. A site that only advertises a listing without processing payment is not a facilitator, so the obligation still sits with the host.⁷

GST is separate. The federal 5% applies on top of the provincial taxes regardless of where the booking happens, and the platform may collect it on the host’s behalf depending on the host’s own registration status and the platform’s sales volume.²

1
Province of British Columbia. Accommodation
2
Canada.ca. Charge and Collect the GST/HST
3
Destination BC. Municipal and Regional District Tax Program
4
BC Laws. Provincial Sales Tax Act
5
Ministry of Finance. Provincial Sales Tax Bulletin Accommodation
6
Province of British Columbia. PST on Sales to First Nations
7
Government of British Columbia. Online Marketplace Facilitators and Sellers, and Online Marketplace Services
8
Province of British Columbia. Register to Collect PST