Tourism falters both ways as departure tax hike slams home
As predicted, international arrivals from key short-haul markets have fallen in July, in the wake of a 17% increase in Australia’s departure tax, announced in the May Budget.
More mysteriously, however, July saw a slowdown in the growth of overseas travel by Australians. Growth in departures fell to just 0.7% compared to an annual rate of 7.1%. Obviously, that’s not due to the departure tax. 
Overseas Arrivals and Departures figures for July, issued by the Australian Bureau of Statistics (ABS) show international arrivals faltered, falling 1.1% when measured against July last year, with significant falls from short-haul markets.
According to the Tourism & Transport Forum (TTF), the fall is due to the departure tax, technically known as the passenger movement charge (PMC).
TTF Chief Executive John Lee said fears about the impact of the departure tax rise were well founded.
“When the PMC increase was announced in the May budget, TTF immediately raised concerns about the impact on short-haul markets,” Lee said.
“The PMC rose 17% from July 1, and arrivals from New Zealand – Australia’s number one source market – fell 4.5% for the month.
“TTF is today writing to Prime Minister Julia Gillard to reiterate our concerns about the PMC rise and encourage her to seek an urgent meeting with New Zealand Prime Minister John Key to discuss measures to mitigate this impact.
“The PMC is an inequitable charge which unfairly impacts on visitors from short-haul markets and we are concerned that this is just the beginning of exacerbated declines in arrivals from markets Australia is targeting for growth in the future.
“Arrivals from Thailand fell 19.5%, Korea dropped 12.9% and Malaysia was down 3.3%.
“Increasing tourism taxes in this way undermines the efforts of Tourism Australia and the state tourism organisations to grow international arrivals.
“The price-sensitive leisure travellers those marketing agencies are targeting will be put off visiting Australia, which now has the highest departure tax for short-haul flights of any developed country.”
The inbound fall is striking because arrival figures previously had been so encouraging. ABS data for the second quarter 2012, up to 30 June 2012, showed overseas arrivals grew to 1.3 million (3.4% higher than the corresponding period in 2011) with increased arrivals from key markets, led in particular by China (+22,000), New Zealand (+9,800), Japan (+6,400), Malaysia (+4,600) and the US (+4,000). Arrivals from the UK, however, were down 17,200, echoing declines in other northwest European markets and some Southeast Asian markets including Thailand (-2800) and Indonesia (-1900).
Edited by : Peter Needham
how much was the PMC increase in $$ terms ? if it was not a significant amount then there are probably other factors involved but if you want to fit the theory you want to promote to selective facts then this is the way to go !! – sloppy journalism