Budget 2021: Hotels’ plea to Government

Tourism groups are not expecting specific sector funding in the Budget but hotels want the Government to make moves in one area – stopping councils imposing bed taxes.

While Tourism Minister Stuart Nash has said that he is not personally working on any bed tax initiatives on behalf of the Government, Queenstown’s council was and a ”targeted rate” on commercial accommodation has been in place in Auckland.

Strategic director of Hotel Council Aotearoa says it wants to see real steps taken towards a lasting solution for the tourism infrastructure funding problem.

”It’s the key challenge for our sector after Covid and cannot be ignored for later.”

He said Queenstown and Auckland were premier tourist destinations and key gateway cities, respectively.

The council recognised the funding challenges faced by local councils in Queenstown and Auckland.

”However, imposing quick-fix bed taxes and targeted rates on top-end accommodation is not the right solution after a pandemic.We cannot impose 20 per cent tax on accommodation when Australia has just 10 per cent and we must remove the temptation for local councils to do exactly that.”

If central Government was investigating improved ways of funding tourism infrastructure, then it should make sure that local councils in Queenstown and Auckland have line of sight towards consistent annual revenues from tourism that can be leveraged for re-investment in tourism infrastructure at a local level, said Doolan.

”In turn, local councils should permanently abandon the boom times bed-tax experiment and commit to working in partnership with central Government and accommodation providers to attract high-quality visitors back to New Zealand.”

Tourism Export Council chief executive Lynda Keene said hotels were one of two areas of the tourism industry that have been overlooked by both tranches of tourism funding support during the past year.

The other sector was transport/coach operators.

”Both of these sectors are seriously bleeding cash as they have high fixed infrastructure costs and lease fees. It would be good if some funding could be found for these businesses and also for Rotorua tourism businesses that have always had a high proportion of international visitors who are struggling to keep afloat until long-haul visitors return,” said Keene.

Her group represents inbound tour operators (ITOs) which got a boost in the $200m pre-Budget announcement by Nash on May 6.

Twenty-six ITOs were offered strategic tourism asset protection programme loans and having $500,000 of it converted to grants.

”It reflects how much the industry knows; ITOs are the key to a safe and well-managed return of international visitors from long-haul markets, and how important they are in the tourism eco-system.”

Keene wants the support extended to other companies but doesn’t have high hopes of any extra funding in the Budget.

The council has asked Government to consider a $200,000 Restart package for 90 other ITOs in New Zealand ($18m).

There are about 120 ITOs in New Zealand.

”Unfortunately we were not successful with this. We will work with MBIE to see if we can explore other options.If we can get funding for other ITOs who have critical commercial relationships offshore, there will be higher survivability rate for the millions of dollars booked in the system.”

Tourism Industry Aotearoa(TIA) says it’s not expecting any more significant news to come out of the Budget for tourism.

However, any extra support for small business would help many tourism operators, said TIA.

Source: Read Full Article