KEY POINTS:
New research on the tourism industry has revealed the Government is getting back double what it invests in the industry.
The finding, which is part of a wider study on the returns from tourism investment, blows away previously held assumptions that tourism is a liability for the Government.
The yield research, which was carried out over three years by Lincoln University, found that in the 2003/04 financial year the Government had a net revenue of $429 million from tourism.
While it spent $103 million on culture, recreation, conservation and heritage access costs, and a further $81 million on tourism marketing, research and policy and regional initiatives, this was more than made up for in tourist tax revenues.
The main income was from GST paid by international visitors which brought in $481 million.
A further $35 million came in from excise tax and $97 million was earned from transport infrastructure (including roading and fuel taxes), border controls and ACC revenue.
"For central government, tourism provides a clear financial benefit," a report on the study stated.
Fiona Luhrs, chief executive of the Tourism Industry Association which jointly commissioned the research with the Government and Tourism New Zealand, said the figure blew away one of the commonly held myths that tourism was not financially beneficial to the Government.
She said it was important that a concrete figure could now be quoted for further policy and budgeting decisions.
However the financial benefits were not so clear when it came to local Government.
A study of four regions found there were significant differences in the level of return on tourism investment for 2005.
In tourist destination Rotorua there was a net financial benefit of 11.3 per cent whereas Christchurch had a financial cost of 0.6 per cent.
The report found that Christchurch had a relatively low number of visitors relative to its population and high roading costs, which were not paid for by central Government, and its art gallery contributed to the negative return.
But Rotorua was able to achieve a significant surplus from tourism which the report largely attributed to it being on a state highway - a major tourist transport corridor.
The council also charged entry fees to non-residents for its museum.
"There is a variance between regions depending on the characteristics that exist within the region, for example routing of state highways, council ownership of revenue generating enterprises, funding mechanisms for art galleries and museums," it stated.
Tourism Minister Damien O'Connor said it had been known for a long time that tourism was a positive contributor to New Zealand but the study provided concrete evidence.
"While this is something we have known for some time, we now have solid research that verifies the industry's contribution to our economy."
Tourism is New Zealand's largest export sector and comes ahead of dairy, meat and wool.
In the year to March 2006 the industry contributed $8.3 billion to the economy.
