Monday , June 25 2018

Government nets $2.6 billion tourism windfall, report finds

The government reaps $2.6 billion a year from international tourism, a new report has found.

Research by Deloitte Access Economics looked at revenue generated for government through international tourism alongside the expenditure associated with hosting international visitors.

The data confirmed that international visitors are more than paying their way.

Tourism Industry Aotearoa (TIA) says the “enormous net gain” is a positive recognition of the value of international visitors.

“We have been pointing out for some time that the single biggest beneficiary of a successful tourism industry is the government – and this report backs that up,” said chief executive Chris Roberts.

The core finding of the Ministry of Business, Innovation and Employment-commissioned report was that central and local governments collect $3.27 billion a year in revenue attributable to international tourism and they incur costs of $638m – for a yearly net gain of more than $2.6 billion.

The revenue includes direct taxes like GST ($1.47b) and vehicle taxes ($264m), along with estimates of corporate taxes ($999m) and income taxes ($353m) from businesses servicing international visitors. An additional $59m is collected in visitor charges and $125m from other sources.

Government expenditure attributable to international visitors covers land transport funding ($328m), the cost of Tourism New Zealand ($117m), and some of the budgets for the Department of Conservation ($60m) and Immigration ($60m).

Funding requirements for other agencies include $36m for customs, $28m for MBIE, and $4m for the Accident Compensation Corporation.

“As the report notes, tourism has a growing importance in the ongoing success and wellbeing of New Zealand businesses, households, and government,” Mr Roberts said.

“International visitors spend $14.5 billion a year in New Zealand – our biggest export earner. The money circulates throughout the economy, and the Government ends up with a net gain of more than $2.6 billion.

“At a time when the government is planning to introduce a new border levy on some of these international visitors, it is extremely helpful that we now have some data showing the size of the contribution these visitors are already making.”

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