A visitor levy on hotels and other accommodation will be discussed by Prime Minister John Key and Auckland Mayor Phil Goff tomorrow.

On Monday, Goff proposed a visitor levy costing a few dollars a night at a backpackers to $20 or more at the city's top hotels.

The levy would apply to Kiwi and overseas visitors and could raise between $20 million and $30 million a year. It would replace ratepayer spending to attract visitors and funding for major events.

Yesterday, Key received a report outlining the need to spend "tens of millions of dollars" for tourist-related infrastructure and how it could be paid for.

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The report identified a range of funding options, but Key did not say if a visitor levy was among them.

The hotel, tourism and hospitality industries have come out strongly against the levy, saying it is unfair because visitors already help the Auckland economy.

Last night, Goff said a visitor levy was not a competition between Auckland Council and the Government, saying in meetings with Key, Finance Minister Bill English and Housing Minister Nick Smith this week he plans to discuss how Auckland can fund growth and infrastructure.

Asked about the possibility of the Government and council both wanting a visitor levy or bed tax, Goff said he had to do what Auckland is capable of doing.

"We have limited options at fundraising and I have announced this as a series of options," said Goff, who also wants to introduce a targeted rate for new large-scale developments and Government approval for a regional petrol tax in his first two budgets.

"I can't sit here at the moment and say maybe the Government will do this in the future. They will make their decisions about what they want to do, and whether they will have an airport arrival tax or whatever, but I'm facing this problem right now.

Auckland Mayor Phil Goff said the proposed levy would free up ratepayer money to leverage spending on things like easing congestion and providing housing for tourism workers. Photo / Nick Reed
Auckland Mayor Phil Goff said the proposed levy would free up ratepayer money to leverage spending on things like easing congestion and providing housing for tourism workers. Photo / Nick Reed

"I have got huge demand for council expenditure on infrastructure ... and the ratepayer should not be burdened with every cost," Goff said.

The new mayor also dismissed calls by some in the hotel and tourism industry not to use the visitor levy on marketing and major events, but for funding infrastructure facilities.

Goff said the levy would pay for marketing and major events and free up $20 million to $30 million of ratepayer money to leverage spending on things like easing congestion and providing housing for tourism workers.

Asked if that was one step removed from tourism, Goff said the two things that affect tourists coming to Auckland was a bad impression of traffic congestion and a workforce that can afford to live in the city.

The city's largest hotel operator, Accor Hotels, is "categorically" opposed to a visitor levy.

AccorHotels senior vice­ president operations for New Zealand, Fiji & French Polynesia, Chris Sedgwick, said a visitor bed levy will unfairly target commercial accommodation providers and travellers who bring associated economic benefits throughout Auckland.

Tourism Industry Aotearoa chief executive Chris Roberts said the council should support tourism growth in Auckland and not try to fleece the golden goose.

Rachael Shadbolt, Hospitality NZ general manager of accommodation, said a visitor levy took a too narrow view of who benefits from tourism and unfairly targeted only hotels, motels, apartments, backpackers and the like.