An incoming Tourist Tax
Apparently it's all go now. http://www.radionz.co.nz/news/political/359649/tourist-tax-up-to-35-to-be-charged Most international visitors (Australia and most Pacific Island Forum countries exempt) will be required to pay between $25 and $35, with the rate still to be set. It'll be collected through a new Electronic Travel Authority. This essentially means that those visitors will probably need to visit a website prior to leaving home, and pay the amount, or something like that.
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Ok, so Labour are doing both, charging tourists double on great walks and putting a tourist tax. $35 is not much, many countries have higher departure taxes. They ought to forget the double charge on Great Walks and lump this tax at $50. Also don't understand why Australia and the Pacific Islands are totally exempt, are they not using the same overstretched facilities?
I'm unsure how Pacific Forum countries work. I think Australians typically come here in a different type of visa, and one which doesn't require them to leave within a certain time (and some don't because they live here). If it's being done based on visas with the intent of charging tourists to enter but not those who live here, it's probably just easier to exempt Australians.
Only country that should be exempt is New Zealand. However I am sure the government will be pleased to have implemented the tax as it will look good on their resume. Even if they do water it down so much that practically no one ends up paying. Not to mention the amount being charged is next to worthless anyway. It will be the NZ taxpayers that end up footing the costs in the end.
I've no argument with that. This is a strategic political move but I can't understand how it's going to solve the problems everyone seems to expect it to solve. It's not lack of a few tens of millions of dollars which has prevented money getting to all the places we think it should be going to. That's been caused by a lack of clear planning and some poor priorities, albeit depending on individual views, when deciding the most important things to spend money on. At best this might calm a few people down through being a clearly visible method of extracting money from a group which voters often look at at want to see paying something.
International tourists have always more than paid their way. Tourism is very profitable for the country. In 2017 international tourists paid 1.5 billion in GST, while a further 1.8 billion was paid by domestic tourist. The tourism infrastructure fund contributed only 25 million per year for infrastructure developments. The money has always been there, it is simply being spent in other areas. The purpose of the tourist tax is to appease envious voters, not make up some funding shortfall.
"It's not lack of a few tens of millions of dollars which has prevented money getting to all the places we think it should be going to. That's been caused by a lack of clear planning and some poor priorities, albeit depending on individual views, when deciding the most important things to spend money on." That's the whole subject in a nutshell @izogi There seems to be an almost galactic level of incompetence in some areas. A case in point, the White Horse camping ground at Mt Cook took in a reported $400,000 last year, yet the toilet facilities are laughable, shameful, farcical, frequently disgusting and should be a major national embarrassment to those who have the funds and the power to remedy the situation. Yet so often what should be an obvious practical decision is bogged down with the socially incestuous, self serving, mumbo jumbo politics of incompetent morons. Sometimes you have to be a bastard to get things done! And nobody has the balls to be that bastard!
The GST idea is somewhat debatable. Not all GST collected gets paid to the general government coffers. All business's whether in the tourist industry or not collect GST, they also pay GST in the course of running their business. When it comes time to pay the GST collected the amount of GST the business has spent is subtracted from the collect and the balance forwarded to IRD. Therefore whilst we can make a reasonable guesstimate of how much GST tourists pay during their visits there is no way in which how much actually gets to the government coffers.
@frankb - I don't think I buy your argument. The whole point with the way GST is levied is that the total GST collected right down the supply chain = 15% of the final retail price. e.g: If I make something from nothing and sell it to a tourist for $100+GST, I pass on $15 in GST to the government. If I run a business based on selling at a margin, and buy wholesale for $50+GST from someone who makes the product from nothing, sell retail to a tourist for $100+GST. Then I collect $15 in GST from the tourist, deduct the $7.50 in GST that has already been paid by the wholesaler (and included in the price I paid), and pass on the remaining $7.50 in GST to the government. = $15 GST in total to govt coffers. Even if there are 100 suppliers in that retail, distribution & manufacturing chain then the total GST paid by all those companies combined still adds up to $15 on a $100 item sold to a tourist.
> Therefore whilst we can make a reasonable guesstimate of how much GST tourists pay during their visits there is no way in which how much actually gets to the government coffers. Yes there is, isn't there? Unless the tourists are somehow running a New Zealand GST-registered business, they can't claim it back from IRD, so all the GST which tourists pay reaches the government. GST's a tax that's only meant to apply to end purchases of goods and services, but not to all the transactions between businesses in between. GST-registered businesses all pay GST when buying stuff for their operations because it's simpler that way, but they declare and claim it straight back with regular GST returns. The same GST returns declare how much GST they've collected from sales (whether by selling to businesses or non businesses), and they'll pay the balance between the two, getting a refund from IRD if they've spent more on GST than they've collected. Otherwise they pay the balance to IRD. The end result, however, is that the only paid GST which doesn't get claimed back is that paid by end consumers of goods and services. Thus GST from the end sales all propagates its way back to IRD through a combination of payments to GST and refunds. Edit: Oops. Yeah what @madpom said.
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