The Alberta government unveiled its 2026 budget, which proposes a new tax for vehicle rentals, along with a bump to its existing tourism levy that would appear on the bill after your hotel or motel stay.
The vehicle rental tax will amount to six per cent, the same as the tourism levy. It will apply to any passenger vehicle seating eight people or fewer, excluding long-term leases, large vans or commercial vehicles like trucks.
One family visiting from Sweden, because their son is working in Banff for the ski season, says that even though their rental car and hotel fees would rise, it wouldn’t be enough to stop them from exploring the Canadian Rockies.
“Almost everything is much more expensive than it was. So it’s just to allocate your money to the right place. Everything is more expensive,” tourist Carl Hammer told CityNews.
Alternatively, one Calgarian I spoke with said the higher tourism levy might sway his decision on whether or not to stay the night in Banff rather than making the short trip home.
“Well, on a personal basis, maybe I might not be looking at that option,” said Segun Arokoyo. “It’s so close, I live in Calgary, right? So most times I go to Banff for a day,”
Alberta Hotels and Lodging Association president Tracy Douglas says the organization and its members were disappointed when they learnt about the increases, especially at a time when people don’t have much extra money to spend, and says cases like Arokoyo’s are common.
“Recognizing that approximately 80 per cent of the travellers in the province are actually Albertans, so by increasing the tourism levy were really increasing the cost for Albertans,” she said.
The provincial government aims to double tourism revenue in the province to $25 billion by 2035, a goal which Douglas says would require significant investment.
She adds that it would be more attainable if all the revenue from the tourism levy were redirected back to growing tourism.