Could New Zealand’s New Tourism Levy Turn Visitors Away?

Very recently, New Zealand has taken a decision to enhance its International Visitor Conservation and Tourism Levy from NZ$35 to NZ$100 implementing from October 1. The government of New Zealand's view on this was the hike in levy would assist the nation in developing the infrastructure and conserving environment. 

However, this has raised concern among locales that the following decision could hamper the recovery of the New Zealand tourism sector, which has remained at lower levels compared to the pre-pandemic era. 

"The new levy remains competitive with countries like Australia and the UK, and we are confident New Zealand will continue to be seen as an attractive visitor destination by many around the world." Matt Doocey remarked!  (Minister for Tourism and Hospitality) 

Would Levy deter visitors?

Planning to visit New Zealand could be costlier as the Government of New Zealand has decided to implement the newer tourism taxes despite a low recovery of around 84% in 2024 compared to the year 2019.  (Pre-Pandemic). 

Based on the government, New Zealand's tax will remain relatively low. For example, the Galapagos Islands, in the month of August, enhances their visitor's levy to USD$200 up from $100. 

Doocy said, " A $100 IVL would generally make up less than 3 percent of the total spending for an international visitor while in New Zealand, meaning it is unlikely to have a significant impact on visitor numbers."

"Yet some tourism bodies fear that the increase could deter visitors." On the contrary, Several airports nestled in New Zealand contradicted the decision by stating it is "bad for the economy," while TIA or Travel Industry Aotearoa has called it a "barrier making New Zealand incredibly expensive to visit." 

How come NZ to enhance the tourism tax? 

 A trip to New Zealand can now be a little expensive from October 1 compared to earlier times. This decision raises an urge to know the backdrop!

According to the NZ government, some of the tourism levy will be used to mitigate environmental negative impacts and establish the infrastructure. New Zealand's current NZ$35 International Visitor Conservation and Tourism Levy (IVL) was introduced in the year 2019 to boost the country's infrastructure. 

Earlier, all visitors from Australia and many Pacific islands were exempted from the flat rate fee generally incurred by International visitors when applying for an NZeTA (New Zealand Electronic Travel Authority) or tourist visa. 

The government cited that NZ generates around NZ$80 million, which is relatively lower to address its tourism sector's issues. Further, the government argued and stated that it puts NZ in line with other countries' tax increments. 

The tourism sector was NZ's largest export market before the pandemic, surpassing dairy exports, but Chinese dominance has led NZ to struggle to recover. Nevertheless, the industry is still worth more than NZ$13 billion a year, with above 3 million foreigners arriving annually. 

According to the NZ government, NZ$100 is about 3% of the total spending for an International visitor in NZ, which may not significantly impact arrivals. 

However, the chief executive of Tourism Industry Aotearoa said: 

"New Zealand's tourism recovery is falling behind the rest of the world, and this will further dent our global competitiveness. This would create a significant barrier at a time when the industry, our second largest export, is sitting around 80% pf pre-Covid levels." 

Note Some Travel Tips to NZ. 

If you are planning to travel, there are some essential New Zealand travel tips that one needs to keep in mind, and some of them are explained below; please have a look:

• Pick a Suitable Season--- NZ's geographical expansion has given it a unique terrain and climate. You must research the area before you hit the road. 
• Baggage Allowance--- It is not always about the destination but is also about your concerned airline's baggage policy. If you exceed the limits by 0.1 KG, get ready to incur additional fee to get an approval. Thus, it is better to ask the rules and then pack the luggage to avoid such scenarios. 
• Documents--- For travel VISA, ensure you get it valid and applicable from the authentic authority because you may need to present them to the official so they allow your visit in NZ. 
• Transportation---- Before you travel to NZ, get yourself well aware of all the available public transport, domestic or International flights, Guided tours, and other things.