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Home / Business / Companies / Airlines

Tourism leader worried tax hassle will deter visitors from New Zealand

Grant Bradley
By Grant Bradley
Deputy Editor - Business·NZ Herald·
15 Jun, 2018 01:37 AM4 mins to read

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It will soon be more expensive to visit New Zealand as tourists face a new $25-$35 tax and others face higher visa fees under proposals aimed at raising money for infrastructure, conservation and immigration costs.

A tourism group is worried a new system of taxing many visitors to New Zealand could deter some from coming here and instead opt for destinations without any paperwork.

A range of travel charge proposals have been released for consultation, including a plan to levy an extra border charge for everyone to cover the cost of immigration processing.

While the planned new tourist tax of up to $35 excludes all New Zealanders, Australians and those from most Pacific islands, deep in consultation documents is a proposal to use the existing border clearance levy to impose a $2.98 charge for everyone.

The charge would cover advanced passenger screening for about seven million passengers through airports.

The new tourism tax - the International Visitor Conservation and Tourism Levy -announced today will be used to improve tourism infrastructure and support conservation.

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The tourist levy would exclude visitors from Australia, which is New Zealand's biggest tourist market, and people from Pacific Islands Forum countries; children under 2 years old; and visitors travelling for business.

Tourism Minister Kelvin Davis said rising tourist numbers bore out the popularity of our unique country but that success came with a burden.

"This rapid growth has impacted on the costs and availability of publicly-provided infrastructure. Many regions are struggling to cope and urgently need improved infrastructure, from toilet facilities to car parks," he said.

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It would raise between $57 million and $80m a year and Tourism Industry Aotearoa says its existence and purpose would need to be carefully explained before its introduction, planned for later next year. Otherwise visitors originating from long-haul destinations could choose to go elsewhere, based on convenience.

''There is that potential if that system is not as simple as possible and not well explained,'' said TIA chief executive Chris Roberts.

''We are going to have to let the rest of the world know about this because it could be a bit of a nightmare if thousands of people turn up without knowing about the waiver.''

In the United States those from visa waiver countries who hadn't filled in online forms in advance were ''put through the wringer'' when they arrived.

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In addition to the $25 to $35 charge, there would be a fee of around $9 for processing the Electronic Travel Authority (ETA) and these would last for two years.

''There may be very good reasons for an ETA but the motivation to introduce it at this time is interesting — its motivated by creating a vehicle to collect a tax,'' said Roberts.

Airlines, which had feared they would have to collect a differential charge, were relieved they don't have to collect the tax through airline charges.

Board of Airline Representatives executive director Justin Tighe-Umbers said charging via airline tickets would increase the cost of getting to New Zealand, and be administratively very complex for airlines.

New Zealand's natural beauty is a drawcard for tourists.  Photo / Grant Bradley
New Zealand's natural beauty is a drawcard for tourists. Photo / Grant Bradley

''The government proposal to charge a visitor levy and electronic travel authority via an online method addresses these concerns, and also avoids the likelihood of delays for passengers at airports caused by levy collection.''

Roberts said his organisation wanted to know more about where the tax would be spent and the mechanism for doing so.

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"Our international visitors will be more accepting of being charged to come to New Zealand if they can clearly see it is going to support infrastructure and services that enhance their visit," he said.

"Our key priority with this new charge is ensuring the revenue is directed to where it can do the most good, relieving pressure on infrastructure and ensuring we continue to deliver outstanding visitor experiences."

The Tourism Export Council of New Zealand said most of its members supported the levy "but only if it was invested back into the industry" and went toward improving tourism attractions and looking after New Zealand's conservation estate.

"Our members are saying there is much more that needs to be done to improve New Zealand's tourism offering and any additional funding should go toward enhancing and developing tourism attractions and infrastructure, encouraging visitor dispersal into the regions and looking after our conservation estate.''

However, it warned that any increased cost imposed on visitors to New Zealand will increase the expectations they have.

"The world of tourism is highly competitive and New Zealand is already one of the more expensive destinations. This means there is an expectation that we will deliver a premium product and more cost on the visitor will increase this expectation," she said.

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