Louise Upston: Tourism Minister on the Government proposing an International Visitor Levy instead of a bed tax

National's promising councils a share of the International Visitor Levy instead of a bed tax.

It wants to split revenue from the $100 levy - currently going to conservation and tourism. 

It would ring-fence $150 million a year for that, letting councils divvy out the remainder based on their number of international guest nights. 

Tourism Spokesperson Louise Upston says New Zealand's cities have differing needs for that funding and it'll be split accordingly.

"This way, it'll get funding from the 1st of July next year, whereas a bed tax would have been at least May '29 before they got any funding - and the best part about this is that Kiwis won't be taxed any time they stay in a hotel." 

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Episode Transcript

Speaker 1 (00:00):
And as predicted on the show, the government has today
announced that councils will have the money replaced that they
lost through the Axed Bed Tax. And it will be
from the International Visitor Levy, which is a tax paid
by foreign tourists. And the tourism minister is Louise Upston. Hi, Louise.

Speaker 2 (00:14):
Hello, Heather.

Speaker 1 (00:15):
So how are you distributing the money?

Speaker 2 (00:18):
Yes, so really importantly, what we will be doing with
the reset of the IVL is distributing more to councils. Well, actually,
they haven't had funding from this pathway before. And it
means as the international visitor numbers grow, so will the
amount that is given to councils to fund tourism and

(00:38):
conservation in their areas. It'll start with 86 million going
up to 106 million over the four years. And that'll
be divvied up based on their share of the international
guest nights that they have in their area.

Speaker 1 (00:54):
Right, so if Queenstown gets a lot of people from overseas,
which obviously it does, it will get more than, for example,
I don't know, let's say Invercargill.

Speaker 2 (01:02):
Correct. Yeah, so Auckland's about 20%, so they will get
the relevant share for their area. And the same with Auckland,
but they've got different needs for what they will use
that funding for, and that's up to them.

Speaker 1 (01:22):
Does Auckland get more money from the IVL through the
way that you're doing it than it would have got
from the bed tax?

Speaker 2 (01:28):
Well, the difficulty is the policy work in detail hadn't
been worked through on a bed tax, so there is
no definitive amount that had been determined. This way, they
will get funding from the 1st of July next year,
whereas a bed tax would have been at least May
29 before they got any funding. And the best part

(01:51):
about this is Kiwis won't be taxed any time they
stay in a hotel or motel or campground in New
Zealand which is what the bed tax would have done.

Speaker 1 (02:02):
So they, I think I recall them saying they would
have got something like $ 27 million a year from the
bed tax. Is that about right?

Speaker 2 (02:10):
Well I think that's the figure they've talked about but
as I said there was no policy work done, no
agreement around how a bed tax would work but But
if they.

Speaker 1 (02:20):
Were right, and you're right, you know, these numbers are
always plucked out of thin air for the most part.
But if you're right, then we're looking at about $ 104 million,
$ 108 million, something like that over four years, and you're
giving them $ 86 million. So they are coming up a
bit short, eh?

Speaker 2 (02:34):
Not Auckland. The total pool available is $ 86 million. So
Auckland will get about $ 19 million in year one. And
it'll increase every year as the international visitor numbers increase.

Speaker 1 (02:47):
Does it not increase to 86 million over four years?

Speaker 2 (02:50):
No, there's two figures. Yes, you're correct. 86 million is
the total amount that we are going to distribute in
year one. And Auckland's share of it over the four years,
you're right, will get.

Speaker 1 (03:04):
Up to 86 million. So they do come up short. Listen,
does somebody need to apologise for people being denied help
with food because it's not an essential item?

Speaker 2 (03:14):
No, there's two things. So MSD have for years assisted
hundreds of thousands of New Zealanders with food hardship grants.
They continue to do that. There will be some cases
where people are declined. If they're unhappy with that decline,
they can appeal that decision. Where there has been an

(03:36):
issue in the way, in a very small number of cases, 0.1%
of food hardship grants the data has been recorded in
a way that's not accurate. That's an operational issue for MSD.
They have assured me that they've sorted it out. But
MSD continues to provide hardship grants for people who are

(03:56):
in need, and they will continue to do that.

Speaker 1 (03:59):
All right, good stuff, Louise. Thanks very much. Louise Upston,
Tourism Minister and obviously Social Development Minister as well. 11
past five.

Speaker 2 (04:06):
For more from Heather Duplessy Allen Drive, listen live to
News Talk ZB from 4 p.m.

Speaker 1 (04:11):
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