New Zealand and Australian travel chiefs are stepping up their campaign against new passenger taxes which they say could be the tipping point for a 10 per cent plunge in transtasman tourism.
Air New Zealand, which last week announced new services and is about to launch a new route to Queensland, is also worried about the impact on its business on the extremely competitive route where margins are already thin.
Australia's Tourism and Transport Forum chief executive John Lee was in Auckland yesterday for urgent talks with his New Zealand counterparts and said the Gillard Government's Budget move was a tax grab to supplement the consolidated fund.
The passenger movement charge will from July 1 jump from A$8 ($10.40) to A$55 for everyone leaving Australia.
Less than a third of the charge will be used to pay for airport and border services. It will also be linked to inflation so could go up every year.
"I appear today as a very proud Australian but I'm very embarrassed by my Government," Lee said.
"I would apologise to the people of New Zealand about these taxes."
His organisation and New Zealand's Tourism Industry Association is stepping up political pressure.
Lee said he would be approaching crossbench MPs in Australia's finely balanced Parliament and here the association has lobbied Prime Minister John Key, who is also Tourism Minister.
A spokeswoman for Key yesterday said he would raise the matter with Julia Gillard "shortly".
About 1.2 million New Zealanders travel to Australia every year and 1.17 million Australians who made short-term visits to New Zealand in the latest 12 months spent an average of $1500 per person.
Lee said while the extra would not be a deterrent to most travellers, it would be for those paying budget fares, and hit families especially hard.
The passenger charges could now make up to 30 per cent of some fares.
Lee said he was sad to be talking "not about some foreign threat but our own Government taxing our own citizens to stop them enjoying a transtasman experience".
* About 1.2 million NZers travel to Australia a year.
* About 1.17 million Australians come to NZ.