Municipal Services Corporation Consultation

The Municipality of Lambton Shores implemented a transient accommodation tax, more commonly known as a Municipal Accommodation Tax (MAT), as of January 1, 2026. As part of this process, the Municipality launched a not-for-profit Municipal Services Corporation to be the designated tourism entity for MAT revenue sharing in Lambton Shores.

On this page:
  1. About the Municipal Accommodation Tax
  2. About Municipal Services Corporations
  3. Next Steps
  4. Frequently Asked Questions
  5. Relevant Resources and Reports
  6. Previous Consultation

What is MAT?

Municipal Accommodation Tax (MAT) is a tax imposed by a municipality on the price of overnight accommodations in its jurisdiction. MAT is typically applied to hotels, motels, and other short-term rental lodging establishments, and is collected from guests at the time of their booking.

The primary purpose of the MAT is to generate additional revenue for the municipality to support various initiatives, such as tourism promotion, tourism-related infrastructure, and tourism product development, which directly or indirectly benefit both visitors and residents.

By implementing this tax on accommodations, municipalities can fairly distribute the costs of hosting tourists and maintaining tourism-related amenities.

How is MAT Distributed?

When MAT is collected, the Municipality keeps 50 per cent of the revenue generated. The remaining 50 per cent must be shared with a designated Eligible Tourism Entity, which is a non-profit entity whose mandate includes the promotion of tourism in Ontario or in a municipality.

For example: if $100,000 was collected through the MAT:

  • $50,000 would be distributed to the tourism entity; and
  • $50,000 would be retained by the Municipality to assist with things like infrastructure projects or other tourism-related amenities or municipal services

The Municipality has created a Municipal Services Corporation to be the designated Eligible Tourism Entity in Lambton Shores.

Why a Municipal Services Corporation?

The primary purpose for implementing the MAT in Lambton Shores is to boost tourism efforts in the Municipality. At the same time, it will alleviate some of the financial pressures associated with tourism on infrastructure and municipal services. By establishing a Municipal Services Corporation (MSC) as the designated tourism entity for Lambton Shores, we ensure that every dollar generated through the Municipal Accommodation Tax (MAT) is reinvested directly into our community.

While there are broader regional or provincial organizations that provide tourism marketing for the area, creating an MSC helps ensure funding stays local to support specific and tangible tourism initiatives that directly benefit our businesses, accommodation providers, and residents. It will also ensure local community members are represented in the decision-making process regarding the application of MAT funds.

With a dedicated tourism entity rooted in Lambton Shores, we can strategically invest in marketing, infrastructure, and other experiences that attract visitors, extend stays, and enhance our reputation as a year-round destination for tourism. This structure will also provide greater transparency, accountability, and measurable results to ensure tourism revenue works for Lambton Shores.

Next Steps

The Municipality of Lambton Shores will be sharing information about board member recruitment for the Municipal Services Corporation in the near future. Information about that recruitment will be shared on this page, as well as through other Municipal channels including social media and e-newsletters.
Visual timeline of project. Currently at the Implementation
Frequently Asked Questions

A MAT is a mandatory municipal tax paid on accommodations. Travelers must pay the amount that is stipulated by the municipality. Many municipalities in Ontario have already implemented a MAT and the majority of municipalities have implemented a 4% MAT.

The authority for accommodation operators to charge and collect the MAT comes from Ontario's Municipal Act, 2001:

  • Section 400.1 grants municipalities the power to impose a transient accommodation tax through by-law

Once a municipality passes a Municipal Accommodation Tax By-Law, all accommodation providers within that jurisdiction are legally required to collect the tax from guests and remit it to the municipality or its designated collection agent.

As of January 1, 2026, MAT collection is mandatory for short-term accommodation providers.

MAT is collected by the accommodation provider at the time of booking. The accommodation provider then remits the MAT to the Municipality based on a remittance schedule outlined in a MAT collection by-law.

More information can be found on the MAT webpage.

More information about MAT can be found on the MAT webpage.

Ontario Regulation 435/17 requires a 50/50 revenue sharing between a municipality and an Eligible Tourism Entity. An Eligible Tourism Entity is defined in Ontario Regulation 435/17 as a non-profit entity whose mandate includes the promotion of tourism in Ontario or a municipality.

A Municipal Services Corporation (MSC) is a separate, legally incorporated entity established by a municipality and operates independently with a separate bank account. Under Ontario’s Municipal Act, 2001, municipalities can create MSCs to oversee projects such as economic development, tourism promotion, infrastructure management, and public utilities. The corporation operates at arm’s length from the municipality but remains accountable through governance structures, financial reporting, and municipal oversight.

In the case of the MAT in Lambton Shores, the proposed MSC would serve as the designated tourism entity. Some advantages include: 

  1. Satisfying the Province’s requirement for a non-profit tourism organization to serve as an Eligible Tourism Entity that utilizes a minimum of 50% of the MAT revenues; and
  2. Adopting a MSC model, which provides accountability, corporate responsibility and reasonable controls through the role of the voting members

Revenue can vary year by year. Based on current estimations using average nightly rentals in Lambton Shores, staff expect that revenue generated from MAT in Lambton Shores could be as high of $400,000 annually (to be split with the designated tourism entity).

Relevant Resources and Reports:

Read the Draft Business Case Study for the Tourism Municipal Services Corporation

Public Consultation: Creating a Municipal Services Corporation

Public input was essential in developing an effective Municipal Services Corporation. The Municipality conducted several public consultation efforts in 2025 to ensure the corporation is structured to successfully support and shape the future of tourism development in Lambton Shores.

Contact Us

9577 Port Franks Road, Thedford, ON N0M 2N0
Municipal Office Hours: Monday through Friday, 8:30 a.m. to 4:30 p.m.

Phone: 519-243-1400 | 1-866-943-1400 | Fax: 519-243-8611