Toronto considering additional hotel tax to offset cost of FIFA World Cup games

The City of Toronto is set to consider an additional tax on hotel rooms to help offset the cost of the FIFA World Cup games in 2026.

In a report to council by the Executive Director, FIFA World Cup Hosting 2026, the Chief Procurement Officer and the Chief Financial Officer and Treasurer to find revenues to pay for the games, an increase to Municipal Accommodation Tax from six per cent to 8.5 per cent was suggested.

Toronto has estimated its part of hosting the elite international soccer competition will cost $380 million, an increase of $80 million compared to a 2022 forecast.

The federal and provincial government will be covering $201.4 million so the city is responsible for $178.6 million of the cost to host the games.

Of this, $83.6 million in revenue has already been identified by the city through existing municipal sources, commercial rights sales, rental fees, and in-kind contributions.

The proposed increase to the municipal accommodation tax applied to hotels and short-term rentals is estimated to bring in $56.6 million in revenue.

It would be in effect from June 1, 2025 – July 31, 2026.

“The hotels are doing quite well. All the rooms are booked, as you can imagine, they will do very well and we asking them to support us and pay a share of it,” said Mayor Olivia Chow.

The Greater Toronto Hotel Association disagrees.

“The industry is not back to pre-pandemic levels, so it’s still in recovery mode. We don’t have as much in the pipeline as we did pre-COVID So I would say that there’s still a lot of opportunity to regain back to where we were pre-pandemic,” said CEO Sara Anghel.

However, the city report says it is anticipated that any potential impacts on hospitality operators will be offset by increased room demand and related visitor spending in the lead up, during, and following the World Cup.

The report will go before council for approval on Nov. 4.

A city spokesperson said hosting the FIFA World Cup in 2026 will bring “significant economic, cultural and community benefits” and create over 3,500 jobs.

Toronto will host six matches that kick off June 12, 2026, including the first-ever FIFA World Cup men’s match on Canadian soil with the opening match of Canada’s Men’s National Team. The games in Toronto conclude with a knockout round of 32 match on July 2, 2026.

Vancouver will also host games at the elite international soccer competition, which Canada is co-hosting with the United States and Mexico.