New Zealand’s decision to nearly triple its tourist levy raises concerns among industry leaders, fearing it may deter visitors and slow recovery.
New Zealand‘s recent decision to nearly triple the International Visitor Conservation and Tourism Levy (IVL) has stirred significant concerns within the country’s tourism sector. Starting October 1, 2024, the entry fee for international tourists will rise from NZ$35 ($22) to NZ$100 ($62), a move aimed at ensuring that visitors contribute more substantially to the country’s public services and conservation efforts.
Tourism Minister Matt Doocey defended the decision, stating that the increased levy would help support high-value conservation areas, biodiversity projects, and improve visitor experiences on public lands. He emphasized that the fee would represent less than 3% of the average tourist’s spending in New Zealand, suggesting that it was unlikely to deter visitors significantly.
However, the tourism industry sees the situation differently. Tourism Industry Aotearoa (TIA) and the International Air Transport Association (IATA) have voiced strong opposition to the hike, fearing it could make New Zealand a less attractive destination, especially in the wake of the COVID-19 pandemic. Rebecca Ingram, TIA’s Chief Executive, argued that the increased levy, combined with higher visa fees, could significantly elevate the cost of visiting New Zealand, potentially undermining the country’s global competitiveness in tourism.
IATA also expressed disappointment, labeling the levy increase as a “double whammy” for the sector, which is still recovering from pandemic-induced setbacks. The association warned that these changes might further delay the recovery of New Zealand’s visitor numbers to pre-pandemic levels, possibly pushing full recovery beyond 2026. “It has been a double whammy for the New Zealand travel and tourism sector, starting with New Zealand Immigration announcing steep increases in visa fees, and now the increase in the IVL. These changes make travel to New Zealand more expensive and less attractive and could further delay the recovery in visitor numbers to beyond 2026,” said Dr. Xie Xingquan, IATA’s Regional Vice President for North Asia and Asia-Pacific.
During the public consultation process for the IVL, IATA provided a submission urging that the IVL not be increased. “Unfortunately, the government announced the increased levy and its application in the 2024 budget while the consultation process was still ongoing, casting doubt on the process’ effectiveness,” said Dr. Xie.
Dr. Xie also noted that the government did not indicate how the funds collected by the IVL will be allocated. “I urge the government to consider allocating the funds collected to projects that support the decarbonization of the aviation sector.”
Despite these criticisms, the New Zealand government maintains that the levy is essential for managing the environmental and infrastructural impacts of tourism. As the country continues to navigate the delicate balance between promoting tourism and preserving its natural and cultural heritage, this levy increase represents a bold step in its approach to sustainable tourism management.
With tourism contributing significantly to New Zealand’s economy—accounting for 3.5% of GDP and generating NZ$13.2 billion in 2023—the industry’s response to these changes will be crucial in shaping the future of the sector. As New Zealand moves forward, the impact of this levy on both the environment and the tourism industry will be closely watched by stakeholders across the globe.
George is the News Feed Manager, Content Creator, and Social Media Manager at the TravelDailyNews network of online newspapers. At the same time, he is completing his studies in the Department of Business Administration at the Athens University of Economics and Business.
