Starting October 1st, New Zealand will significantly increase its International Visitor Conservation and Tourism Levy (IVL), raising the charge from NZ$35 (Rs 1,825) to NZ$100 (Rs 5,214).
The move, which marks a nearly 200% hike, has sparked discussions about its potential impact on tourism numbers.
New Zealand’s government has justified the substantial increase, describing it as a crucial measure to support economic growth and ensure that international visitors contribute fairly to public services and the quality of experiences offered in the country. The increased levy is part of a broader strategy aimed at mitigating the environmental impact of tourism while strengthening the local economy.
Tourism and Hospitality Minister Matt Doocey and Conservation Minister Tama Potaka emphasized that the higher IVL will help sustain and enhance public services and conservation efforts. "The government is committed to growing the tourism sector as part of our goal to double exports within the next decade. International tourism is vital to New Zealand's economy, contributing over NZ$11 billion in the year ending March 2024," Doocey stated.
However, the ministers also noted the costs that tourism imposes on local communities, including increased pressure on regional infrastructure and higher maintenance costs across conservation areas. The IVL, first introduced in 2019, was designed to ensure that international visitors help cover these expenses, which are primarily funded by New Zealand taxpayers and ratepayers.
A public consultation conducted by the Ministry of Business Innovation and Employment (MBIE) revealed strong support for the levy increase, with 93% of respondents agreeing that it was a reasonable step to help manage tourism-related costs.
Despite the hike, New Zealand’s IVL remains competitive with similar charges in countries like Australia and the UK. The government is confident that the increased levy, which would typically account for less than 3% of a visitor's total spending in New Zealand, will not significantly deter tourists from choosing the country as a travel destination.
The additional revenue generated from the higher levy will be directed towards supporting high-value conservation projects, such as biodiversity protection in national parks and enhancing visitor experiences on public conservation land.
The government already invests nearly NZ$884 million annually in tourism and conservation, funding initiatives like Tourism New Zealand and the preservation of natural heritage and recreational sites, including Milford Sound, Aoraki/Mt Cook, and the Tongariro Alpine Crossing.