Ontario All-In ITC Price Advertising Rules Set To Move Forward
Open Jaw by Bruce Parkinson
As of 01JAN17, Ontario consumers won’t need a calculator to figure out the price of an ITC package if proposed amendments to the province’s Travel Industry Act go forward as expected.
The move has been recommended to the Ministry of Government & Consumer Services by the Travel Industry Council of Ontario, based on feedback from travellers, travel agents and even many of the wholesalers that would be affected by the change.
It would require all businesses registered under TIA to display the total price of a travel package, including all taxes, fees, levies and other charges when advertising travel services.
TICO President & CEO Richard Smart says all-in pricing will be good for the industry’s perception among consumers. “We’ve received several consumer complaints with regard to package pricing – for example trips advertised at $399 that come with an additional $569 in taxes and fees. Consumers are losing confidence in the travel industry, which is understandable.”
Smart says “most good wholesalers” are very much in support of the proposed change.
Other proposed amendments to the act include an exemption from Travel Industry Act requirements for Ontario businesses that exclusively offer 1 day tours, and a realignment of filing deadlines for trip completion claims against the Ontario Travel Industry Compensation Fund.
Stemming from the Conquest failure, where some Canadians stranded by the operator were forced to pay exorbitant hotel rates and airfares to complete their vacation, the amended regulation would give travellers up to 6 months to file a trip completion claim vs. the current 3 months.
TICO is proposing an increase to the Compensation Fund contribution rates from $0.15 per $1,000 in travel sales to $0.25 effective 01JUL16. Smart says the increase is necessary to keep the fund above $20 million, which TICO considers an appropriate level to provide Ontario consumers with adequate protection.
Smart says the increase is necessary because “the complexity of the business has increased significantly,” while fewer registrants have translated into lower revenues.
Some registrants aren’t happy about the price increase, Smart acknowledges, which he calls “a reflection of the business environment they’re feeling.” But he points out that previously scheduled contribution increases were cancelled in 2013 and 2014, as revenues were enough to maintain the fund at an acceptable level.
“We looked at the next 3 yr. business plan and realized the increase would be required,” Smart says. He pointed out that the increase would put the required contribution at the same level it was in 2001. “Not many businesses can say that their fees are what they were 15 years ago,” Smart says.
With the increase, an agency with $2 million in sales would see its annual contributions rise from under $300 per year to under $500.