Australia tourist tax set to increase from July 2024

Anyone flying out of Australia will soon be taxed AU$70 per passenger, per trip. Photo / File

A recent budget announcement in Australia regarding plans to increase the charge for travellers has been slammed by local tourism organisations.

According to the federal budget, released on Tuesday by Treasurer Jim Chalmers, the Passenger Movement Charge (PMC) will increase by AU$10 to AU$70 from July 2024.

This is expected to generate AU$1.3bn per year for the government but increase travel costs for Australians and visitors.

Tourism and Transport Forum (TTF) chief executive Margy Osmond called it a “tourism tax” and claimed it would further hinder the recovery of tourism in Australia.

“This will make it even more difficult for tourism to bounce back, as cost-of-living pressures increase and as the industry rebuilds from the devastating impacts of the Covid pandemic,” she said.

“It will also make it more expensive for international tourists to come to Australia, at a time when we’re desperately trying to attract more visitors, with Australia’s international tourism levels still below pre-Covid levels.”

An additional AU$10 will be added to every flight out of Australia and is projected to generate AU$1.38bn in revenue in 2024/25 according to the Australian Federation of Travel Agents (AFTA).

Deciding to increase the PMC by 16 per cent was “extremely disappointing” according to AFTA chief executive Dean Long, who said now was “not the time for additional taxes” as the industry was still in a state of recovery.

“We know that the PMC does reduce air capacity to Australia and with supply of air seats still tracking 30 per cent to pre-Covid levels, this will slow down our recovery,” he added.

An additional AU$10 does not seem like much but AFTA claims it will cost the industry an additional AU$520 million over the five years following 2022/23.

According to Osmond, the Tourism and Transport Forum has called for the government to make no more increases for the next five years “to provide certainty for the tourism sector.

“As we continue to recover from the biggest event to impact the tourism industry in recent memory, the freeze will be critically important to give the industry much-needed certainty,” she said.

The government also needed to be more transparent about how funds collected through the PMC were being spent, she said.