Toronto hotels can add 3% marketing fee: Roseman

Wendy Larman is upset about a three per cent fee added to her bill for a stay at the Sheraton Gateway Hotel at the Toronto International Airport.

“It should not take a chartered accountant to decipher a bill at a major hotel like this. Fortunately, I am one,” she says.

She was having a 10-hour reunion with her son and daughter-in-law, who live in Inuvik, NWT, and stopped over in Toronto overnight after a South American trip.

After booking the hotel through her CAA branch in St. Catharines, Ont., she was quoted a rate of $542.50 for a suite and $208.05 for a room. But the electronic invoices she received by email when leaving didn’t add up.

The suite, for example, showed $70.53 in harmonized sales tax (HST), which should have increased the $542.50 rate to $613.03. But the invoice said $629.30.

“I stopped at the front desk, thinking an error had been made. The clerk printed out a different invoice, showing ‘other charges’ of $16.27. She said 16 per cent was added to all Ontario hotel bills to cover taxes and the DMP,” Larman told me.

“I asked why this fee wasn’t mentioned in my quote or when I checked in and she could not answer.”

DMP stands for Destination Marketing Program, a fee of up to three per cent of hotel room revenues that goes to a non-profit marketing organization to promote a city or region.

The DMP is supported by the Ontario tourism ministry, which encourages transparency and full disclosure.

Participating businesses that charge a marketing fee separately to the guest are supposed to use the following criteria:

  • Staff will be trained to ensure they understand and can explain the fee. In particular, they should say that fee is not a government tax or levy.
  • Price advertising will include clear notice of the fee before booking. Visitors should not be surprised when they get their bill.
  • The fee will be shown as a separate item on the purchaser’s invoice or receipt.
  • “The Greater Toronto Area does not have any form of hotel tax,” says the hotel association that runs the DMP for Toronto and Mississauga and provides funds to Tourism Toronto for promotion.

    “Marketing is the lifeblood of tourism. People won’t come to a city if they don’t know about it.”

    People also won’t come to a city if they aren’t given the right information. Transparency is lacking when you check hotel rates at the Tourism Toronto website.

    The Hilton Garden Inn downtown, for example, is $279 a night, with $36.27 in “taxes” and $8.37 in “service charge.” The total is $323.64.

    When you click “Rate Details,” you find the taxes are 13 per cent per room per night and the service charge is three per cent per room per stay. There’s no mention of the DMP fee.

    Catherine Velie, manager of the Sheraton Gateway Hotel, said the invoices do itemize taxes and fees separately. The one she sent me goes as follows:

  • Room charge $136.55.
  • Room HST $17.75.
  • Destination Marketing Program $3.63.
  • Destination Marketing Program HST $0.46.
  • Total $158.39.
  • Larman’s confusion arose from dealing with inexperienced staff members, Velie said. The front desk team has been retrained to explain the DMP fee and inform guests that it’s an optional charge.

    “If a guest disputes it, it just gets removed,” the manager told me.

    In Larman’s case, it took several hours to remove the DMP from her bill. Both the clerk she dealt with and the acting manager were adamant that the fee was compulsory.

    “I understand that tourism needs to be promoted, but to make the tourists directly pay an extra, undisclosed ‘compulsory’ charge for it is just bad business for Ontario,” she said.

    Bottom line: Ask about DMP when booking Toronto hotels and check bills for any unexplained services charges. You have the right to dispute the fee, since it is not a government tax.

    source:http://www.thestar.com

    Filed Under: Marketing

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