tourism marketing levy - case for the whitsundays
DESCRIPTION
Why do cities/regions need a marketing levy (or resort tax)? How can it help tourism promotion in any location in Australia.TRANSCRIPT
Proposed Marketing Levy –Case for Whitsundays
The Introduction of a Marketing Levy?
� Common throughout the USA, Canada & Europe (in the range of 2-14%)
� It sits on top of a GST or VAT� It sits on top of a GST or VAT
� All accom taxes in Australia deemed irrelevant with the introduction of the GST in 2000
� A marketing levy of 2%pa in the Whitsundays Regional Council would yield $2.5m and 10%pa would yield $12m on current accommodation turnover
Marketing Levy - Advantages
� It does not burden the normal income tax collection system but are a tax on consumption
� It does not drain state or local operating budgets
� It can be applied to the specific problem area, i.e. marketing of tourism by directing collections into relevant tourism authorities
Marketing Levy - Disadvantages
� Any new levy is generally opposed on principle, but this is not a levy on all taxpayers, rather it is user-pays
� There are additional administrative costs, as with the GST
� It can create market distortions if too large and not widely applied
Marketing Levy in Florida (introduced in1967)
Tax Percent
Municipal Resort 2%
Food & Beverage 2%
Tourist Impact 2%
Convention Development 2%Convention Development 2%
Tourist Development 1%
Total 11%
Enacted legislation to be used for:
• The creation and maintenance of convention centres, cultural/arts centres
•The enhancement and promotion of tourism
•Appropriate signage installation and maintenance
Accommodation Levies Around the World
Location Levy
Fiji 5%
Hawaii, USA 9%Hawaii, USA 9%
California, USA 10%
Florida, USA 11%
Bali 15%
Australian Industry Size – Annual Turnover 2007-08
Food & Beverage $72bn 9.0%
Tourism $75bn 9.4%
Retail $150bn 18.8%
Motor Vehicles $173bn 21.6%
Manufacturing (Incl Mining) $250bn 31.3%
Other – Education/Govt etc $80bn 10.0%
Total GDP (Approx) $800bn
Annual Council Funding for Tourism Marketing
Local Council Budget $ per capita
Brisbane $16.6m $8.00
Gold Coast $10m $16.80
Sunshine Coast $8.5m $25.50
Cairns $4m $21.60
Whitsundays $750,000 $21.40
Annual Federal Funding for Tourism Marketing
Country Budget $ per capita
New Zealand AUD$190m* $45.25
Bali AUD$43m $31.70
Fiji AUD$29m $27.65
Australia AUD$169m $8.45
* Air New Zealand contributes $90m
Return on Investment
(AEC Group, National Tourism Investment Strategy, 2006)
Business Type (AUST) ROI 1998-2004
Tourism Businesses 11.8% pa
All Businesses 14.9%pa
(AEC Group, National Tourism Investment Strategy, 2006)
� The tourism industry has been saved by technology and innovation
�Low cost airfares and accommodation packaging
�Online booking and virtual tours
Whitsundays Accommodation
Qtr
Rooms Avail Room Nights Sold Occupancy % Takings $m $ Av Nightly Rate RevPAR Income per room
2009 2009 2009 2009 2009 2009 2009
Whitsundays
Mar 2,937 124,008 46.9 27.9 224.46 $ 10,527.17 $ 38,424.19 Mar 2,937 124,008 46.9 27.9 224.46 $ 10,527.17 $ 38,424.19
Jun 2,939 119,924 44.8 24.7 205.25 $ 9,195.20 $ 33,562.48
Sep 2,911 152,202 56.8 30.5 200.28 $ 11,375.90 $ 41,522.05
Dec 2,906 153,176 57.3 35.7 233.34 $ 13,370.38 $ 48,801.89
Calendar 2009 2,923 549,310 51.5 118.8 215.83 $ 11,104.58 $ 40,531.72
Whitsundays = Regional Council boundary including Bowen and Hamilton Island (28% market share)Hamilton Island has 823 beds with approximately 80% occupancy
Source: ABS 8635.0
Whitsundays Accommodation
Qtr
Rooms Avail Room Nights Sold Occupancy % Takings $m $ Av Nightly Rate RevPAR Income per room
2009 2009 2009 2009 2009 2009 2009
Great Barrier Reef Islands
Mar 2,632 114,996 49.1 32.6 283.46 $ 13,917.89 $ 50,800.28 Mar 2,632 114,996 49.1 32.6 283.46 $ 13,917.89 $ 50,800.28
Jun 2,608 104,120 43.9 27.6 264.14 $ 11,595.75 $ 42,324.47
Sep 2,562 141,135 60.0 36.3 256.92 $ 15,415.20 $ 56,265.48
Dec 2,560 148,622 63.1 43.1 289.91 $ 18,293.32 $ 66,770.62
Calendar 2009 2,591 508,873 54.0 139.6 273.61 $ 14,781.65 $ 53,953.00
Source: ABS 8635.0
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