A bed or border tax to bolster Queenstown looks dead in the water.
Tourism Minister Paula Bennett has given a clear indication the government’s unlikely to allow direct tourist charges.
She says she’s aware of the pressure caused by the booming tourism industry.
But: “I’m not convinced a bed tax or visitor levy is the right way to go about this.”
Mayor Jim Boult, MP Todd Barclay and Queenstown Chamber of Commerce all back charging visitors to improve the resort’s creaking infrastructure.
The airport alone welcomed 1.8 million visitors last year but there are only 20,000-odd residents along with businesses to pick up the rates bill.
Bennett, who met with Boult last week, says: “We certainly accept there is pressure in some places.
“We are currently looking at how we might address this.”
She adds: “The government is prepared to fund priority tourism infrastructure.”
Boult, Barclay and chamber boss Ann Lockhart all say they’re actually encouraged by the minister’s comments.
Boult – who rated income from a visitor levy as one of his top priorities during the election campaign – had a “very warm and collaborative” meeting.
“What she’s saying is she doesn’t favour a tourism levy but she is opening the door to other ways of assisting high-growth tourism areas such as ours.
“I’m perfectly relaxed as to what form some assistance should take and look forward to further engagement.”
The chamber and council commissioned Sapere Research Group to create a business case on a levy, which was presented to the minister.
It is being considered by government along with a McKinsey infrastructure report, commissioned by major tourism businesses.
Lockhart says the government is considering options and she sees it as a “work in progress”.
“The positive of this is we are definitely on their radar.”
Barclay says he’s been bending ministers’ ears about the issues since his election.
“I’m encouraged by minister Bennett’s comments that there will be an avenue for our district to tap in to more government funding.”
Bennett highlights the $5.5 million made available through the Regional Mid-sized Tourism Facilities Grant Fund.
Queenstown has not had any money from that so far but central government has funded the Kawarau Falls Bridge and other projects.
Bennett also told Newshub she’s negotiating with Finance Minister Steven Joyce to get more money for council infrastructure. GST tourism receipts grew from $1.7 billion to $2.6b in recent years.
But she says some projects fall squarely in the basket of local government.
The government’s making $1b available through its infrastructure fund – but that’s loan money which has to be paid back through development contributions.
Queenstown’s council will tomorrow consider charging landowners for the eastern access road.
It plans a 4.25 per cent rates hike, while Otago Regional Council rates will likely skyrocket with its $60m spending plan.