Local Government New Zealand today expressed strong disappointment at the Government’s decision to reject a room tax as ‘weakness in the face of scaremongering’.

“We are extremely disappointed in this announcement – the tourism industry has engaged in quite misleading scaremongering over this issue and has misrepresented the possible impact of a targeted rate on commercial accommodation” said Mr Winder Chief Executive of Local Government New Zealand.

Internationally room taxes are a widely accepted way of raising revenue to support public activities that benefit commercial accommodation providers. Room taxes are commonly used to fund convention centres, visitor information centres, and regional tourism promotion.

“It is very odd that the Government is prepared to provide funding to encourage local government to support the development of the tourism industry on the one hand – but now see this practical way of equitably funding support for tourism as a ‘threat to the tourism industry’”.

“Local government collectively spends tens of millions of dollar a year supporting the development of the tourism industry. Many communities find that level of support very difficult. Neither the Government or the tourism industry should take that support for granted” said Mr Winder. “Both should be keen to pursue funding that provides for fair ways of funding the development of the industry – a room tax is one way to achieve that”.

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