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Tourism tax backed at national level

NZ Newswire logoNZ Newswire 28/11/2016

Auckland Mayor Phil Goff wants to tax the city's visitors, but Labour leader Andrew Little says it's fair that all tourists should have to help fund the facilities that make their holidays more enjoyable.

Mr Goff wants a per-night levy on accommodation in the city for tourists as part of his proposed budget next year.

And while Mr Little thinks he's on the right track, he believes a tourism tax or levy should come from central government.

It's hoped the Auckland tax would raise about $30 million in order to reduce the cost of infrastructure for ratepayers while keeping rates from rising more than 2.5 per cent.

But it has been criticised by Tourism Industry Aotearoa chief Chris Roberts who says it would unfairly target accommodation providers when the wider city benefited from tourism.

"It is wrong of the mayor to suggest that visitors are not already paying their way," he said.

"Auckland is benefiting more than any other part of New Zealand from the tourism boom - and the benefits flow throughout Auckland's economy."

He said only about 10 per cent of visitors' money was being spent on accommodation.

"Tourism is a huge success story for Auckland. The council should be supporting its continued growth, not trying to fleece the golden goose," he said.

"Commercial accommodation providers are not only unfairly singled out, but will face additional administration costs to collect the proposed rate."

It also ignored visitors who used services such as Airbnb or stayed with friends or family, he said.

But Mr Goff told TV3's Paul Henry show an increase of $6 or $10 would not put off visitors who were already paying hundreds for hotel rooms.

"Of course [ratepayers] get a benefit from tourism, and that's why we promote it. But it also puts pressure on our already pressurised infrastructure and resources," he said.

He said the Airbnb-style services could also be drawn into the levy once the details were hammered out.

Mr Little said he thought in principle it was right to ask tourists for money to fund additional tourism facilities.

"I happen to think it should be done at a central government level and I'm very keen to see that issue explored," he said.

Prime Minister John Key also backs the idea of a national tourism tax rather than at a local level.

But he said implementing the tax on accommodation posed difficulties, including in areas like Franz Josef and Fox Glacier where major tourist facilities are required but few people stay the night.

Mr Key has received a report from the tourism industry identifying a shortfall in funding and identifying possible solutions.

No decisions are expected to be made on those suggestions until early next year.

As part of his proposed budget, Mr Goff has also put forward a regional fuel tax and a special rates category for large-scale developments in a bid to discourage land banking.

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