Industry leaders call on Albanese government to freeze ‘tourist tax’ for 5 years

Industry leaders call on Albanese government to freeze ‘tourist tax’ for 5 years
By James Harrison


Four prominent travel industry leaders have co-signed a letter addressed to the Albanese government asking it to freeze the $70 ‘tourist tax’ that travellers have to pay when leaving Australia.

The signatures on the letter include: James Goodwin, CEO of the Australian Airports Association (AAA); Dean Long, chief executive of the Australian Federation of Travel Agents (AFTA); Margy Osmond, chief executive of the Tourism & Transport Forum (TTF); and Joel Katz, managing director of Australasia Cruise Lines International Association (CLIA). The four addressed the Prime Minster directly, asking him to make this change to the tax, formally named the passenger movement charge (PMC), considering the standing of the travel industry post-COVID.

“As of the signing of this letter, our international air capacity stands 30% below pre pandemic-levels, and the proposed 16% increase in the PMC represents another hurdle in our recovery,” the letter wrote.

“Our members need certainty in government taxation policy to reinvest into restoring Australia’s aviation capacity. Our industry strongly opposes the decision and were left disappointed with the lack of consultation with the industry before deciding to lift the PMC by $10. It was also disheartening for our sector that has suffered more than most during COVID combined with already one of the highest departure taxes in the world.

“This increase places a further burden on our sectors when international visitor numbers are far below pre-pandemic levels and struggling to recover, with cost of living making domestic tourism even more vulnerable and unlikely to fill the international shortfall.”

The government says that the tax hike is in line with inflation and is due to raise an extra $520m over five years. This is the first tax increase since 2017 and will begin in July 2024.

TTF’s infographic on the impact of the PMC (Source: TTF)

This tax was established with the intent of supporting biosecurity costs associated with travellers among other things, according to Agriculture Minister Murray Watt.

The letter said that freezing the tax will creating certainty for the travel industry that is essential for recovery from the pandemic and driving travel forward.

Furthermore, we request full transparency regarding how the PMC funds are allocated and spent.

“This will enable clear and open communication between industry and government to foster trust and together, ensure that the contributions made, are effectively supporting our shared objectives,” the letter said.

Katz said that considering Australia already charges international travellers some of the highest fees in the world this will only makes things worse.

“This is yet another cost for Australian cruise fans and overseas visitors, creating a disincentive that affects countless Australian businesses like travel agents, tour operators and industry suppliers,” Katz said.

“This increase will undermine the cruise industry’s efforts to revive its $5 billion-a-year contribution to the national economy and its ability to bring economic opportunities to communities around the country.

“Our travel agent members are telling us that now is not the time to put an additional burden on travellers.”

The Council of Australian Tour Operators was not present on the signature. Travel Weekly awaits comment as to whether the council was invited to sign the letter and what its stance on the call to freeze the tax is.

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