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In a move that has stirred significant debate, the New Zealand government has announced a decision to increase the International Visitor Conservation and Tourism Levy (IVL) from $35 to $100, effective October 1 2024.
This decision, announced September 3, follows public consultation earlier this year that explored whether the levy should be maintained at $35 or increased to $50, $70, or $100. The new levy is intended to ensure that international visitors contribute to public services and the quality of experiences during their stay in New Zealand.
However, the tourism industry is pushing back, warning that the steep increase will deter visitors and hinder the sector’s recovery. Rebecca Ingram, chief executive of Tourism Industry Aotearoa (TIA), expressed strong concerns about the impact of this decision in a media release, August 3 and says “Tripling the IVL to $100 is a barrier making New Zealand incredibly expensive to visit.”
“New Zealand’s tourism recovery is falling behind the rest of the world, and this will further dent our global competitiveness. Airline connectivity isn’t a nice to have for a country at the bottom of the world – it’s essential.”
The government’s reasoning for the increase centres on the need for international visitors to contribute more directly to the costs of maintaining New Zealand’s tourism infrastructure and conservation efforts. In a media release September 3, Ministers Matt Doocey and Tama Potaka stated, “The International Visitor Conservation and Tourism Levy (IVL) will be raised to $100 to ensure visitors contribute to public services and high-quality experiences while visiting New Zealand.”
Minister for Tourism and Hospitality Matt Doocey further says “The Government is serious about enabling the tourism sector to grow as part of our overall goal of doubling exports in 10 years. International tourism plays a hugely important role in the New Zealand economy, with international visitors spending over $11 billion in the year ending March 2024. But international tourism also comes with costs to local communities, including additional pressure on regional infrastructure and higher upkeep and maintenance costs across our conservation estate.”
The IVL, introduced in 2019, was initially established as a mechanism to ensure international visitors contribute directly to these costs, which are primarily borne by New Zealand taxpayers and ratepayers. According to public consultation findings by the Ministry of Business, Innovation and Employment (MBIE), 93 per cent of submitters supported raising the IVL, citing the need to cover the costs of tourism as a primary rationale.
In the release, The Ministers argued that the new levy remains competitive when compared to similar fees in other countries, such as Australia and the UK, and emphasised that the increase would likely have minimal impact on overall visitor numbers. Minister Matt Doocey says “A $100 IVL would generally make up less than 3 per cent of the total spending for an international visitor while in New Zealand. “Meaning it is unlikely to have a significant impact on visitor numbers.”
In addition, the increased revenue from the levy is expected to support high-value conservation areas and projects, such as biodiversity initiatives in national parks and enhancing visitor experiences on public conservation land. Minister of Conservation Tama Potaka noted in the release. “Taxpayers already contribute close to $884 million a year directly on tourism and conservation, including tourism promotion, natural heritage, and recreation. This money funds Tourism New Zealand, protects biodiversity within the Department of Conservation estate, and provides quality experiences at the likes of Milford Sound, Aoraki/Mt Cook, and the Tongariro Alpine Crossing.”
