Accommodation sector hits out at Victorian bed tax

A new tax proposed by the Victorian State Government has come under fire from Accommodation Australia.

NOW is “not the time to pull up the welcome mat”, Victoria’s accommodation sector has warned, cautioning a proposed new tourism tax for the state would impact its attractiveness as a destination.

A $5 levy on bookings for short-term rentals and hotels in Victoria is being considered by the State Government, which is planning an overhaul to its housing policy.

Accommodation Australia (AA) warned the new tax would be an unfair way to deal with Victoria’s housing crisis, particularly impacting the state’s reputation as a great place to hold conferences and events.

“This new tax would see many travellers simply head to states like NSW and Queensland, or avoid Australia to save on costs, especially tourists from countries like China where Tourism Australia is currently campaigning to Come say G’day,” Chief Executive Officer Michael Johnson said.

“The return of overnight international tourists is critical to Victoria meeting projected visitor number and spending targets – spending by international visitors is still less than half what it was in 2019 – down $4.6 billion.

“Not only it is an unfair extra burden on hotel guests, it will have an impact on other tourism-related businesses in Victoria which have been doing it tough since COVID.”

Almost $1 million of direct cost would be added to Victoria’s hotel pipeline if the levy is introduced, AA said.

“A bed tax would create a significant barrier to Victoria’s attractiveness from a business meetings and events perspective,” Victoria General Manger Dougal Hollis said.

“Hotel occupancy levels are still below pre-pandemic figures and in the mid-sixty percent range.

“This new tax sends the wrong message – that Victoria doesn’t welcome tourists, all to fix a rental housing crisis we are not contributing to.”

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