Visitor levy scarcely lightens massive QLDC ratepayer burden

Thursday, 21 June 2018

OPINION: I can understand the accolades for the proposed central Government visitor levy.

It's a brave new direction. It has great potential for significantly increasing the investment in the country's conservation estate and for some councils it will deliver the solution to tourism infrastructure challenges beyond the means of small ratepayer based communities in the form of much-needed facilities such as toilets and parking areas.

Conversely for a destination where every single ratepayer is effectively funding infrastructure to provide for 34 international visitors per annum (compare this to Auckland's ratio of 1 to 1) then, respectfully, the proposed International Visitor Conservation and Tourism Levy begins to look like another contestable pot, unlikely to offer anything even close to the level of investment required in the Queenstown Lakes District.

And let me address one small but perfectly formed misconception.

We have a ratepayer base of 22,000, total. Yes, tourism injects money into the economy but much of this leaves our community.

Our ratepayers are just like any other demographic in many ways, teachers, nurses, police officers, and hospitality and tourism workers.

We have a number of tools at our disposal to offset the burden on our community to deliver the peak-time infrastructure that is required.

However, the 2018 long term plan that we will be asked to adopt at the end of next week has exhausted those options.

I would be doing a grave disservice to my community if I were to join with those who think the Government's proposed visitor levy will deliver the golden goose for our district and our wider region.

It won't.

The Government's intention to collect a sum of $25 to $35 tax at the border will achieve a sum total relative to the level of investment needed in the Queenstown Lakes District alone.

Let me be clear, this council identified that it could not head north with the begging bowl every year.

We know we need a sustainable localised solution and we know we have one.

Our council has lobbied this and the previous Government for the power to implement a bed tax.

We have suggested at numerous meetings and in a recently-commissioned business case submitted to Government in February this year, that a scalable tax, just like other countries around the world successfully apply to visitors, added to the per night cost of a hotel room, campervan or Airbnb would be the best way of funding the localised cost of the infrastructure our district requires to sustain our enormous contribution to the New Zealand tourism economy.

Whether they stay in Queenstown or not, visitors to our country are often sold their holidays on images of our district.

With its pristine natural environment, fantastic food and wine offerings, adventure tourism and cultural experiences we have long been the poster child for tourism in this country.

Last year, we hosted 5.5 million visitor nights in Queenstown alone.

We estimate that $40m per year is required in this district to stop any degradation of the visitor experience that keeps tourism elevated as our premier industry and employer of over 200,000 New Zealanders.

Should the international visitor levy pass in its current form, noting that Australians (our biggest market) and Pacific Islanders will be exempt, Government estimates that $58m to $80m will be raised.

Half of these funds are destined for the much-deserved Department of Conservation leaving $29m to $40m for tourism infrastructure across the country.

At best, I think we will get $1m or $2m from this pot leaving our 22,000 ratepayers to continue to carry the massive burden of providing for our millions of visitors.

Remember the old adage of 'Give a man a fish and he eats for a day, but teach a man to fish and he eats for a lifetime'?

Our business case asked central Government not for a hand out or a one off payment but for the ability to tax the users of our public facilities so that revenue collected can be reinvested in the areas where tourism pressures are felt.

Our residents are already challenged by the high cost of living in this district coupled with wages well below the national average.

As a council we have been mandated with providing bold leadership to enable our vibrant communities to remain sustainable.

I intend to continue to lobby for the ability to implement a bed tax and to push for recognition of our research which highlights the needs of these communities and the undesirable outcomes which will follow if underinvestment continues.

I am perfectly comfortable that a bed tax is not the answer or desirable for other councils.

I think it's essential to test this option with local communities and wrapping some democratic process around the introduction of any bed tax will be important but, given our tool box is empty, it's critical we have another option at our disposal.

The good news is that the introduction of a visitor levy is now going through a consultation period and central Government is asking for feedback.

I strongly encourage anyone who supports the intention but can see flaws in the collection method to make a submission before the deadline of July 15.

A visitor levy alone is not the answer.

Jim Boult is Queenstown Lakes District Council Mayor.