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Comprehensive Overview of the Taxation Issue Impacting Canadian Campgrounds

On June 19, 2024, MP Lianne Rood took a significant step forward in support of this issue in the House of Commons by introducing Private Members Bill C-410, entitled “An Act to amend the Income Tax Act (campgrounds).” The first reading of this Bill marks the culmination of nearly a decade of concerted efforts by all provincial campground associations, the Canadian Camping and RV Association (CCRVA), the Recreation Vehicle Dealers Association of Canada (RVDA), and the Canadian Recreational Vehicle Association (CRVA).

We are immensely grateful to MP Rood (Lambton-Middlesex-Kent) and her dedicated staff for prioritizing this critical issue and collaborating with us to craft this vital legislation.

The Issue:

Canadian campgrounds have long been classified under the Income Tax Act as passive investment businesses rather than active businesses. This classification subjects them to a higher tax rate, which is typically reserved for non-operational investments. Unlike other small businesses that benefit from the lower small business tax rate, campgrounds are unfairly burdened by these tax regulations, despite their active and operational nature.

Impact on Campgrounds:

This misclassification has several detrimental effects on campground operations:

  • Financial Strain: Higher tax rates reduce the profitability of campgrounds, limiting their ability to reinvest in their facilities and services.
  • Competitive Disadvantage: Campgrounds face a competitive disadvantage compared to other tourism-related businesses that qualify for lower tax rates.
  • Inhibited Growth: The financial burden hampers the expansion and upgrading of campground facilities, directly affecting the quality of services offered to campers.


Outcomes Achieved So Far:

Over the years, concerted advocacy efforts have led to significant progress:

  • Raised Awareness: Through persistent lobbying and public campaigns, there is now greater awareness among policymakers and the public about the unfair tax burdens imposed on campgrounds.
  • Legislative Progress: The introduction of Private Members’ Bill C-410 by MP Lianne Rood marks a pivotal advancement. This bill proposes to amend the Income Tax Act to recognize campgrounds as active businesses, making them eligible for the small business tax rate.
  • Growing Support: The issue has garnered support from various stakeholders within the tourism and small business communities, amplifying the call for tax fairness.


How Campgrounds Can Get Involved:

To build on this momentum and push for successful legislative change, campground owners and operators can engage in several ways:

  1. Engage with Local MPs: Campgrounds are encouraged to contact their local MPs to discuss the impact of the current tax policy on their business and the local economy. Sharing personal stories and the operational realities of running a campground can be particularly persuasive. It’s crucial to communicate the importance of their support for Bill C-410, emphasizing how their backing can positively influence the entire tourism sector and local communities.
  2. Participate in Advocacy Campaigns: Joining forces with organizations like the Canadian Camping and RV Council (CCRVA) and participating in coordinated advocacy days can amplify the message. These campaigns often involve petitions, letter-writing campaigns, and social media outreach.
  3. Educate and Mobilize Guests: Campgrounds can inform their guests about the issue and encourage them to participate in advocacy efforts. This can include providing guests with information on how to contact their representatives or participate in public petitions.
  4. Collaborate with Industry Partners: Partnering with local tourism boards, business associations, and other campgrounds can help unify the message and strengthen the lobbying effort.


Unified Voice in Support of Canadian Campgrounds:

The push for tax fairness for campgrounds is not just about alleviating financial burdens; it’s about recognizing the vital role these businesses play in promoting tourism and supporting local communities across Canada. By coming together and voicing their concerns, campground owners, operators, and supporters can help ensure a successful resolution to this long-standing issue. Their active participation is key in urging MPs to understand and support Bill C-410, securing a sustainable future for the industry.