Thank you very much. I appreciate the opportunity to be back here again with you. It seems like it was only about six weeks ago.
My name is Tony Pollard. I am president of the Hotel Association of Canada. We represent all of the lodging industry across Canada. I'm not going to name out all the members because I'd eat up my five minutes in doing that.
As I said, I was here on September 19, when I pointed out that tourism is a growth industry worldwide. I also pointed out that Canada is losing market share in this growth market. I underscored the impact of the western hemisphere travel initiative--passport, dollar, energy--and I'm not going to get into all of that again at this point.
However, we are now even more threatened with the proposed elimination of the GST visitor rebate program. Just in terms of the size and scope of our industry, in the hotel industry we generated $14.2 billion in 2005. The value-added is about $12.8 billion. We employ 301,000 people right across Canada. The important point I love to remind the people in government is that the hotel industry alone generated $5.7 billion in tax revenues, of which $2.5 billion goes to the federal government, and I continue to reinforce that point.
Where are we today? Unfortunately, Canada is losing market share. We slipped from 12th place to 7th place worldwide. Our U.S. market is in a free fall. While international visits are increasing, they cannot make up this deficit on their own. Here's some new news for you: two days ago, on Tuesday, November 7, the World Tourism Organization released a study that shows that travel internationally worldwide is up by 4.5%, whereas Canada's travel is down 4.1%. We have the dubious record in the Americas of only being exceeded by Montserrat, Aruba, and Uruguay as being places where people travel to less than Canada.
Funding for the CTC, the Canadian Tourism Commission. Our colleagues from the CTC are here. I always like to point out that we need more money to support the Canadian Tourism Commission, that an investment of $50 million would result in $1.2 billion worth of new business, that a $100 million investment would alone give the feds $620 million of new revenue.
Let's get to the GST, the reason we're here today. At the outset, let me say that perhaps we as an industry could have done a better job of quantifying the impact of the GST visitor rebate program on our convention, tour, and group business. We are very much aware of and support the fact that the government is casting a discerning eye on all government programs that spend taxpayers' dollars. We support that completely.
Let me give you a couple of numbers very quickly. In 2005, total tour, group, and convention business in Canada generated in excess of $1.28 billion. This proposed program cut is putting in jeopardy all of this business because it's making it 6% more expensive. The new Government of Canada prides itself on its competitive agenda, but I don't think they quite understand--I think they're getting it now--this impact.
Let me just tell you how. The government is shooting itself in the foot, because what they are doing is jeopardizing tax revenues of $496 million on the $1.28 billion that we generate just in the group, tour, and convention business if this exemption for business coming into Canada is eliminated. Of that $496 million, which is going federally, provincially, and municipally, $218 million of that goes directly to the federal government.
Let me expand on that very briefly. I'll be the first one to say that all of that $218 million to the federal government will not be lost, but even if half of it is lost, what it means is that you're trying to save $75 million, but forgoing $109 million as a result. I can name various cities and what it means, the impacts there. I won't get into that right now. However, let me just say that around the world foreign competitors are just showing so much delight and glee because we are 6% more expensive.
Ladies and gentlemen, our commitment to you and to the Canadian taxpayers is accountability. We are not asking for handouts, but simply your commitment to this program. This will, in turn, provide the government with funds for other critical programs you're undertaking.
Thank you very much, Mr. Chair and ladies and gentlemen, for this opportunity.