It's an election waiting game as QLDC reignites bed tax talks

by Lauren Pattemore - Aug 23, 2023

A visitor levy for the Queenstown Lakes District is firmly back on the agenda, as the council meets with Wellington decision makers to flesh out the proposal, but next steps may depend on who the October national elections deliver into power.

QLDC chief executive Mike Theelen says there have been meetings between himself and government officials regarding the visitor levy since New Zealand's border reopened.

It’s a project that was put on the back-burner during the pandemic, but as international tourism has ramped back up, so have the council's conversations with central government departments.

The figure floated in 2019 was a five percent charge added to the cost of accommodation, including Airbnbs, and payable by visitors. 

However, Mr Theelen says the next steps for the levy are reliant on who gets into government in October.

The levy would require legislation through parliament, and Mr Theelen says it needs sponsorship from an MP. The council isn’t keen to push it through before the general election.

“What support there currently is for this, and the priorities of any incoming government, is not something we can predict but we will be taking the matter up with ministers and officials after the general election.

QLDC chief executive Mike Theelen has been to Wellington and spoken with ministers about a visitor levy.

“Once we have a sense of the government’s position post-election we’ll decide how best to restart that dialogue with the sector. Any future introduction of a visitor levy would come with significant lead times to enable providers to plan ahead."

Plenty of work on how a tax could be collected and distributed had been nutted out pre-pandemic.

“We were working with government officials on the legislative design and the collection and administration models required to collect and account for the income generated by any levy,” Mr Theelen says.

In discussions pre-pandemic, then-mayor Jim Boult and the council proposed introducing what was essentially a bed tax on short-term accommodation in the district as a means to help fund visitor-related infrastructure and services in the area.

it was widely supported by residents, in a postal vote sent out to all ratepayers in June 2019, 81.37 percent of respondents voted in support of a levy being introduced.

The proposal now sits with the new council.

Mr Theelen says he and Mayor Glyn Lewers discussed the subject with Tourism Minister Peeni Henare during his visit to Queenstown in April.

Plus, it is a recurring agenda item for quarterly meetings of the Whaiora Grow Well Partnership governance group, a Crown-local government-iwi partnership to help the district manage growth, he says.

This year, the spatial plan group has held meetings on March 6, May 29, and August 7.

Mr Theelen most recently met with Department of Internal Affairs and Ministry of Business, Innovation and Employment staff in Wellington on May 5 to discuss a visitor levy.

Tourism minister Peeni Henare confirms he’s had meetings with QLDC staff and Mayor Glyn Lewers, and a visitor levy has come up in those discussions.

These conversation have involved Queenstown Lakes Mayor Glyn Lewers, although he hasn't responded to Crux's request for an interview.

Minister Henare says the visitor levy is part of a “wider piece of work” that he intends to progress later in the year.

The introduction of Three Waters legislation and lessons learnt from Covid-19 may require a rethink of the 2019 proposal. 

“A large portion of the proposed levy was based on the additional cost of servicing water-based infrastructure. Whilst affordable water reform has impacted on this, we intend to rerun our models to establish what the levy might look like in the light of these changes,” Mr Theelen says.

The QLDC had also written to the local accommodation sector with a consultation framework for the visitor levy, but this was placed on hold, as it was sent out “immediately prior” to the Covid-19 outbreak.

Mr Theelen says before the pandemic, the QLDC had agreed with the visitor sector to continue dialogue to establish a clear implementation pathway and timeframe.

Mayor Glyn Lewers told Crux earlier in the month that considerable effort had gone into a visitor levy.

The mayor was approached for further comment for this story but did not respond.

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