Tourist groups flex their muscles on planned visitor tax

The Heaphy Hut run by the DOC which will get more support from the visitor levy. Photo / Greg Bowker

Tourism heavyweights have identified fish hooks in the planned international tourist tax which they want changed before it is imposed.

The government wants to introduce a $25 to $35 charge on all visitors from countries apart from Australia and most Pacific Island nations to fund tourism facilities.

The levy will collect between $57 million to $80m a year (depending on the rate selected), which will be split between tourism infrastructure and conservation activity.

While there is broad acceptance of the tax, tourism representatives say there is a risk of confusion among visitors, the danger of them being double charged, one organisation saying it won't raise enough money and another wanting a five-year limit on the charge.

The submissions also expose sharp differences between tourism groups over the best way to fund facilities.

Submissions to the government closed yesterday and the Tourism Export Council says some visitors to Department of Conservation (DOC) land could be hit by multiple times.

''Tourism operators have paid a concession to DOC for years and these costs are passed to the visitor. This new levy effectively means our visitors will be paying twice or more dependent on the type of holiday they choose and how often they access commercial tourism activities on conservation land,'' said council chief executive Judy Chen.

Current DOC concessions have targeted group visitors for many years and the new levy would further disadvantage visitors travelling in groups.

She said that should the levy go ahead the council would like to see a review of the current concessions paid by tour and coach operators to ensure that visitor contribution across the board is equitable.

There had been some ''significant increases'' in operator concessions recently as DOC has a monopoly in the areas they operate and determines the market rate.

''New Zealand is already considered a relatively expensive holiday destination. Our members are concerned that multiple costs imposed on visitors may deter them from enjoying as many of the great tourism sights and activities we have to offer."

We have also seen some significant increases in operator concessions recently as DOC has a monopoly in the areas they operate and solely determines the 'market rate'.

Her group also queried why Australian and Pacific Island visitors would be exempt from paying the levy.

Tourism Export council chief executive Judy Chen. Photo / Supplied

"This is a significant number of international visitors not having to pay the levy who will still be accessing the same tourism attractions and facilities as those who have paid."

Exemptions, particularly for the Australian market, could be as much as $37.5m if the level at the lowest amount of $25 per person."

Tourism Industry Aotearoa says, while its members would rather have more of the share of $1.6 billion, its support for the International Visitor Levy is conditional on the final design of the scheme.

These include clarity on how the funds are allocated and that the funding is additional and not a replacement for existing Government expenditure.

The industry is also wary of further costs being imposed and says no further taxes, such as bed taxes now in place in Auckland or regional levies, should be contemplated.

The organisation said there would be a need for a global public relations campaign to educate would-be visitors about why they are being charged to come to New Zealand and what was intended to be achieved by the levy.

The main collection method will be a new Electronic Travel Authority, (ETA) which visitors from visa-waiver countries such as Britain and the United States will have to complete before travel.

They will have to pay an estimated $9 for the ETA, on top of the visitor levy. The levy will be added to the cost of visas for visa-required countries like China and India.

TIA chief executive Chris Roberts said there was scant detail on the levy's design and allocation process.

"A deliberate approach is needed, including an understanding of what is already provided for through other funding mechanisms, what is not working and what is falling through the gaps," he said.

His group wanted the rate set at the upper end — $35 per person.

"We consider that setting it at the lower end may result in unwelcome short-term pressure to increase the rate. We ask that the rate be set for a minimum of five years.
Ad-hoc reviews of fees and levies are frustrating for both visitors and operators. Stability in the tax is important to the industry," the TIA said in its submission to the Ministry of Business Innovation and Employment.

"There are serious risks to New Zealand's reputation if the introduction of the ETA is rushed or poorly implemented."

A group representing regional tourist groups has taken a also flagged problems it sees with the plan and is at odds with the TIA's stance on funding.

The scale of the proposed visitor levy fund is not enough for it to be meaningfully split between regional tourism as well as conservation initiatives, the organisations say.

In its submission, Regional Tourism New Zealand says the levy should go towards conservation initiatives that support tourism activities.

But RTNZ chairman, Graham Budd said that was only if alternative regional tourism funding was also developed to support the growing tourism needs in the regions.

"The proposed visitor levy does not go far enough to meet the growing requirements of the tourism industry, particularly if it has to be shared with conservation programmes," he said.

"It might seem odd that we are turning down money but having to split the fund across so many parties is going to significantly reduce what the fund will be able to do."

Instead, as part of the new legislation, RTNZ wants the government to enable the development of a regional levy framework that will support regional tourism needs including.

Its executive officer Charlie Ives said his organisation "agreed to disagree" with the TIA on some issues — one of them being the ability for local authorities to impose targeted rates.

The proposed levy will go through a legislative process and will likely be implemented in the second half of 2019.