New Zealand plans to triple its air passenger levy

The tax on arriving passengers is set to soar from NZ$20 to NZ$63 in December.

By Bloomberg News, July 5 2021
New Zealand plans to triple its air passenger levy

New Zealand plans to more than triple a levy it charges travelers crossing the border, running the risk of slowing a fragile recovery in the tourism sector, according to the industry body.

The government has in principle agreed to raise the border processing levy for air passengers to NZ$63 from NZ$20.11 on December 1, Tourism Industry Aotearoa said Friday in Wellington, citing documents obtained under the Official Information Act.

The levy, used to fund customs and biosecurity services, will also rise to NZ$35.36 from NZ$21.06 for cruise passengers, TIA said.

New Zealand’s tourism industry, once the nation’s biggest export earner, has been decimated by the pandemic, with the border still largely closed to foreigners. Adding more costs for a traveler runs the risk of putting some visitors off once the border reopens, TIA said.

“We are strongly opposed to this option,” Chief Executive Chris Roberts said. “It is too soon, too impactful on the traveler and will slow down the recovery for thousands of tourism businesses.”

TIA said the consultation document prepared by the Customs Service and Ministry for Primary Industries contained a range of options from no change to as much as NZ$160 per air passenger. It is calling for no change to the levy before July 2023, Roberts said.

While quarantine-free travel has resumed with Australia, the government and companies like Auckland International Airport have signaled they don’t expect the border to reopen fully until some time in 2022.

The government has said it wants to transform the tourism industry in the wake of the pandemic, targeting more high-value visitors amid concerns mass tourism is damaging the environment.

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