Does the Auckland Accomodation Rate Need to Drop?

Tourism Industry Aotearoa says yes.

Tourism Industry Aotearoa is calling for Auckland Council to drop the Accommodation Provider Targeted Rate permanently. In its submission on the Council’s Emergency Budget 2020-21, TIA explains that the COVID-19 pandemic has severely impacted Auckland’s accommodation providers.

TIA chief executive, Chris Roberts, explained that TIA's Auckland hotel members saw a decline in accomodation revenue of $75 million in March, April, and May 2020 compared to the same three-month period in 2019. When combined with the loss of other revenue, such as food, beverage, conferences, events – it is clear the impact on hotels is catastrophic.

"Overall occupancy was down an average of 43.7 percent over the same period. The only saving grace is that a number of Auckland hotels are being used for quarantine purposes," Roberts added. 

While TIA has endorsed the Council’s proposal to suspend the APTR from 1 April 2020 until 31 March 2021, it also thinks the council must not reinstate the rate. Not ever. TIA has consistently opposed the rate on behalf of the accomodation sector. This is on the basis that it unfairly targets accomodation providers who were not the only beneficiaries of visitors to Auckland. 

The benefits of tourism are spread across the entire Auckland economy. The accommodation sector receives just 9 percent of the visitor spend in Auckland but is being required to fund 50 percent of Council marketing efforts (through Auckland Tourism, Events and Economic Development) to grow this spend.

The next few months will provide an opportunity to review the targeted rate and come up with better solutions for council funding.

“More than ever, it’s important councils do not impose unreasonable costs on businesses, so that they have the best chance of surviving. We need our hoteliers and accommodation providers, who are essential to the tourism industry and to the economy, to be part of the important conversations we’ll be having as we begin to rebuild in a post-COVID-19 world.”

Read TIA’s submission here: