WRONG MESSAGE: The so-called Backpacker Tax is sending the wrong message to holiday makers.
WRONG MESSAGE: The so-called Backpacker Tax is sending the wrong message to holiday makers. Patrick Woods

The good, bad and ugly of Budget for our tourism

THE 2016-17 budget announcement earlier this week was a mixed bag for tourism on the Sunshine Coast.

It was disappointing not to receive more funding for the Bruce Hwy and there was nothing for the rail line between Beerburrum to Nambour.

We need serious investment in appropriate tourism infrastructure - airport, rail and road to generate significant returns from increased visitation, longer stays and let's not forget the jobs that flow from such investments.

On the plus side, the government will provide more incentives to grow the small business sector with a proposal to cut tax rates for about 870,000 small- to medium-sized companies, many of whom are tourism operators in the region with an annual turnover of less than $10 million.

There is a promise to introduce greater innovations in visa processing, including new user-pays, fast-tracked visas for India and the UAE, along with a three-year multiple entry visas for India, Thailand, Vietnam and Chile.

While these are not key visitor markets for the Sunshine Coast, they are emerging particularly within the international education sector.

Further commitments include rolling out a $43million Tourism Demand-Driver Infrastructure Program to improve the quality of regional tourism infrastructure.

I also welcome the government's funding commitment to Tourism Australia, which will help to keep Australia competitive in what is an increasingly aggressive market.

However, the proposed decision to raise taxes on backpacker visitors is still in limbo.

If the decision goes ahead for these visitors to pay a marginal tax rate of 32.5% from their first dollar earned, it will have a negative impact on tourism.

It sends out a message that holidaymakers are not welcome by charging a higher rate than our competitor destinations - a message that is in stark contrast to the growth-focused approach taken by New Zealand.

Further to this, many tourism and agricultural businesses will be adversely affected should changes not be made.

Backpacker numbers on working holiday visas will slow and regional areas such as the Sunshine Coast will be impacted.

The coming weeks will be interesting and we will continue to collaborate with partners and fight to bring about a better outcome for our tourism.

 

Simon Ambrose is CEO of Visit Sunshine Coast.


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