Tourism hoping for more from budget 

No help for CTC - tax measures may help businesses

The recent federal budget is both good news and bad news for the tourism sector.

It includes measures that should put more money in the pockets of taxpayers – discretionary money they may choose to spend on travel – but it also neglects to increase funding of the Canadian Tourism Commission, according to the Council of Tourism Associations (COTA), the voice of the B.C. tourism industry.

For some time Canadian tourism representatives have been advocating for an increase of $100 million in federal funding for the CTC, the national Crown Corporation responsible for tourism marketing.

"Our concern is that as the world becomes more expensive, and it is more competitive out there, Canada is losing ground in terms of its marketing efforts," said Mary Mahon Jones, COTA’s CEO.

Currently the federal government funds the CTC to the tune of $75.8 million. COTA believes that it should be funded for $175 million.

"The business case shows that an investment of an extra $100 million would result in a $620 million return (in the form of additional tax revenues) for government, so there is a good business case for this," said Mahon Jones.

"We feel that (level of funding) will be able to assist the CTC in putting together a more far reaching campaign. One of the issues, for example, is that our U.S. market is declining and we need to have some real effort put into doing some more marketing in the U.S. to bring people to Canada."

There is a sense of urgency behind the desire to increase funding as Canada deals with several big tourism issues including the 2010 Winter Olympic Games and the Western Hemisphere Travel Initiative, which will require all travellers to and from the U.S. to possess a valid passport or alternative "secure" documentation by January 2008.

"Even before it is implemented in 2008 we could be looking at a 12 per cent decline in U.S. visitation so that is a big concern for us," said Mahon Jones.

Figures for January of 2006 show that U.S. visitors to Canada were down 5 per cent to 1.6 million. Total automobile travel from the U.S. recorded a 12.4 per cent decrease in February 2006, with overnight car travel declining 11.6 per cent and same-day auto travel declining 12.7 per cent, its lowest level on record.

Other travel modes also registered significant declines in February, with total plane travel down 12.1 per cent and bus travel dropping 17.2 per cent. In addition, train, boat and other methods declined 21.5 per cent.

This is the second year that the increase in funding for the CTC has not been addressed said Mahon Jones, adding that COTA will be working with its national partners through the Tourism Industry Association of Canada to continue to draw attention to the issue with the federal government.


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