‘Tourism taxes’ disastrous for Auckland – TIA

Media Release

‘Tourism taxes’ disastrous for Auckland – TIA

10 November 2006

A new Rugby World Cup stadium promises to transform Auckland – into an unaffordable, uncompetitive visitor destination, the Tourism Industry Association New Zealand (TIA) says.

“The tourism industry is not opposed to a new national stadium and has an open mind as to its location. However, we are vehemently opposed to the use of bed and airport taxes to pay for that stadium,” TIA Chief Executive Fiona Luhrs says.

The Government has said today it will develop funding mechanisms that will enable local and regional councils to raise revenue without recourse to rates. TIA believes this refers to taxes on visitors, which have already been proposed as a mechanism to help fund a new or redeveloped stadium.

Such taxes would mean people visiting Auckland, whether on business or holiday, would end up paying for a stadium used predominantly by Aucklanders. In the case of airport taxes, the authorities would be requiring people passing through Auckland International Airport to pay for the stadium, Ms Luhrs says.

“This would mean, for instance, that a couple visiting Auckland for an event like the U2 concert later this month would contribute to the stadium, whether or not they want to. If the bed tax was $10 a head per night, that would immediately add $40 to their two-night stay,” Ms Luhrs says.

“A family of four staying in an Auckland motel for a week – while a child receives treatment at Starship Children’s Hospital, for instance – would find themselves paying an extra $280.”

Bed taxes will lead to a reduction in overnight visits, impose costs on individual tourism operators and put the margins of some businesses beyond the point of viability, she says.

They will reduce the competitiveness of the tourism economy. Bed taxes are also the kind of punitive costs that undermine the reputation of New Zealand as a 100% pure destination.

“Today’s announcement follows the release of the latest commercial accommodation statistics which show the trend for guest nights is flat. For Auckland, the figures are even worse. For the year to September, Auckland suffered the biggest drop in guest nights in the country – down 199,000 or four percent. Forcing Auckland accommodation providers to increase their rates or absorb the new levy will do nothing to improve those statistics.”

TIA has sought meetings with Rugby World Cup Minister Trevor Mallard, Finance Minister Michael Cullen and Tourism Minister Damien O’Connor to discuss the proposals but all three have declined to meet the tourism industry, Ms Luhrs says.

“I only hope Mr O’Connor will offer to pay his airport tax when he travels to China tomorrow,” she says. “We encourage the Government to make the right decisions on this critical issue for the New Zealand tourism industry.”

TIA will continue to lobby vigorously against all proposals to tax visitors in order to fund a new stadium.

Visit www.tianz.org.nz to read what TIA Members are saying about this issue.

ENDS

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