Cairns business: Cairns Regional Council wants 2.5 per cent bed tax for tourists
Charging Far North tourists a 2.5 per cent bed tax could generate $16m for destination marketing. Visitors in Cairns share their reaction to the idea – what do you think?
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A BED tax for tourists is back on the table with Cairns Regional Council seeking support for the proposal from the Local Government Association of Queensland (LGAQ).
The council will take the proposal to charge a 2.5 per cent levy on short-term accommodation to the LGAQ conference to be held from October 17 to 19 at Cairns Convention Centre.
It wants the levy to apply statewide.
The idea was floated two years ago and had in-principle support from the then State Tourism Minister Kate Jones and the State MP for Cairns Michael Healy.
All of 77 councils in the state except Cassowary Coast Regional Council supported it.
But the emergence of the Covid pandemic meant the proposal did not go any further.
Mayor Bob Manning said the recent Tourism Industry Reference Panel report, Towards 2032 – Action Plan for Tourism Recovery, included a recommendation for legislative change to provide local governments with the ability to implement a visitor tourism levy under an opt-in model.
“A lot of things got put on the backburner when Covid hit, it certainly wasn’t the time to go forward with it,” Cr Manning said.
“A tourism levy of this nature is in place in many countries – it won’t cost the industry.
“But it needs the support of local councils.”
“During the first half of the decade to 2019, Queensland lost significant market share to overseas beach competitors, while domestically, Victoria overtook Queensland for total overnight visitor expenditure for the first time,” he said.
Cr Manning said that recent visitor numbers and spend in Tropical North Queensland showed that increased investment in destination marketing had a positive result.
“Through targeted campaigns and increased government investment, domestic travellers spent a record $3 billion in the year ending March 2022, up 18.8 per cent from 2019,” he said.
“That is clear evidence that increased investment and resources yield positive results.”
He said a levy of 2.5 per cent would be less than the cost of a cup of coffee and would raise more than $16m annually for destination marketing and tourism industry development.
This would deliver an estimated $176m return, he said.
The council provides Tourism Tropical North Queensland (TTNQ) with $3.4m annually.
TTNQ chief executive Mark Olsen unequivocally supported an increased investment in destination marketing.
“When you increase destination marketing you get results, as we saw with the federal government’s $10m investment over the past two years,” Mr Olsen said.
“That $10m allowed TTNQ to achieve $300m in campaign-generated direct visitor expenditure by investing in targeted campaigns and working with our tourism and aviation partners.
“Over the past two years our region has claimed the number three destination nationally in Google search trends for travel and this helped to propel growth in the destination’s market share.”
He said the Far North was the only region in the state to exceed domestic visitor spend beyond pre-Covid levels.
“This success was a direct result of the increased funding.”
Mr Olsen said $16m could create 1000 new job.
Tourists have said they would choose Cairns again as their pick of holiday destinations even if the council’s proposed bed tax is implemented.
Paula and Craig Keating, a couple from Melbourne, arrived at Cairns for their first time on Tuesday morning, on the Pacific Encounter cruise ship, and said a 2.5 per cent tax on future accommodation wouldn’t stop them from making a journey to the Far North again.
“As long as they’re putting it back into the economy, we don’t mind,” said Mr Keating
Ms Keating, who said she hadn’t seen any promotional material for Cairns, thought the idea of the tax funding further marketing campaigns made sense.
“If it’s going to bring something to the tourism industry, I don’t have a problem with it,” she said.
“It might stop others, people with young children, but we don’t need to worry about that any more.”
Cairns Regional Council is proposing, at this stage, a 2.5 per cent tax that would apply to a suite of accommodation proprietors, including hotel and Airbnb options.
Christopher Lamb, from Sydney, also threw his support for Cairns despite tax changes and echoed what the Keating’s said.
“It wouldn’t make any difference to me. I’ve been here a few times. I like the place and that’s it,” he said.
His partner, Taryn Rowe, agreed.
“A two per cent increase is not that much if you think about it. We pay ten per cent for GST, so why not pay another two per cent? It doesn’t really matter,” she said.
Mayor Bob Manning said he is not concerned that a potential bed tax would discourage visitors from choosing Cairns as their holiday destination.
“We’ve got a wonderful suite of destinations … but you’ve got to have a robust structure where you can magnify to the maximum number,” he said.
“One of the fundamental principles under all this is that the tax is passed to our regional tourism organisation. The organisation is then able to go out and market and promote this region and get the best possible return.
“This is not a dumb idea, it’s one that’s been around since the mid 1990s and it’s one that’s exponentially right.”
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Originally published as Cairns business: Cairns Regional Council wants 2.5 per cent bed tax for tourists
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