2017. Coupled with the release of a final report on short-term rentals which indicated tax implementation as one of the areas to be pursued, the City is likely to implement a sliding scale tax on hotels, bed-and-breakfasts, and short-term rentals. 

It is unclear what the difference in tax rates will be. A compromise that appeases the hotel industry, which along with unionized hotel workers are vocal proponents of short-term rental regulation, could include a lower tax rate for hotels coupled with higher tax for short-term rentals. The Cittegaticlalso_sperifirallv target unhosted short-term rentals with 4" assen.hipler tax rate. This way, a proper home-sharing short-term rental could be taxed less than an unhosted short-term rental. 

Forward-Looking Solutions 

Toronto has reached a tipping point in tackling housing shortages, dealing with budgetary shortfalls, and managing public expectations that have converged with the emergence of the short-term rental market. Regulation is on the horizon, but a good approach would keep the following considerations in mind. First, complaints of noise and the changing composition of neighbourhoods as a result of frequent short-term renting could be managed by taxing unhosted rentals as a business. In addition, regulation should require licensing of hosts to mirror what the City is doing with long-term landlords. Second, concerns about the lack of revenue can he addressed by implementing hotel and Airhnb taxes. This new revenue source could be earmarked for injection into the Toronto Community Housing Corporation, which provides affordable rental units and for which there is a current ten-year wait list. Finally, the interplay of short-term and long-term rental unit availability is fundamentally a cash flow problem. The Province of Ontario must partner with the City to allow for proper long-term rental unit creation.