New Zealand Government is to increase the International Visitor Conservation and Tourism Levy (IVL), coupled with steep visa fee hikes which could damage the country;s tourism industry.
The International Visitor Conservation and Tourism Levy in New Zealand will increase to NZ$100 from NZ$35 on October 1, aiming to boost economic growth and ensure visitors contribute to public services and experiences.
Tourism Industry Aotearoa has criticized the higher fee, stating it will act as a barrier to visitors, making it prohibitively expensive to visit the country known for its Māori culture and stunning natural landscapes.
New Zealand’s tourism industry has been struggling to recover from the pandemic, with visitor numbers lagging behind pre-pandemic levels. The country first introduced the levy in 2019 to address issues related to large visitor numbers impacting infrastructure and the environment.
Despite concerns raised by industry bodies, Tourism Minister Matt Doocey defended the levy increase, stating that it would only represent a small percentage of most tourists’ average spending in the country and that New Zealand would remain competitive in the global tourism market. The tax does not apply to visitors from Australia and the Pacific region.
The International Air Transport Association (IATA) is among those who expressed disappointment with the move.
Dr. Xie Xingquan, IATA’s Regional Vice President for North Asia and Asia-Pacific (ad interim), stated that the increased costs could make travel to New Zealand more expensive and less appealing, potentially delaying the recovery of visitor numbers beyond 2026.
New Zealand’s aviation market recovery currently lags behind countries like Australia, Canada, France, Spain, the UK, and the US, which have either recovered pre-pandemic passenger levels or are expected to do so in 2024.
IATA recommended that instead of raising the IVL, the New Zealand government should focus on enhancing the country’s competitiveness as a tourist destination. Dr. Xie also urged the government to allocate the IVL funds towards projects supporting the decarbonization of the aviation sector.
In the year ended June 2024, New Zealand recorded 3.2m international visitor arrivals, up 28pc from the previous year, but still just 87pc of pre pandemic levels.
