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Replacing the targeted rate

May 24, 2017 Destination Global No Comments Email Email

The Auckland Mayor’s office is offering to replace the controversial targeted rate on commercial accommodation providers, but wants the sector to wear the substantial cost for a year.

Tourism Industry Aotearoa, which has coordinated industry opposition to the rate, says it is unacceptable to try and push through an unfair proposal by offering to fix the mess later.

The targeted rate on around 330 Auckland properties from which commercial accommodation is provided has been strongly opposed. It would see a sector that gets 9% of the visitor spend in Auckland asked to pay 100% of the cost of tourism and event promotion carried out by ATEED for the city. Individual properties are facing rate rises of up to 300%.

TIA Chief Executive Chris Roberts says in opposing the unfair rate, there has always been a willingness from accommodation providers to sit down and talk about a better model.

“The sector is willing to make a fair contribution towards the promotion of Auckland.”

In an email exchange this week with one TIA member Hotel, the Director of Finance and Policy in the Mayor’s office has offered to discuss an industry funding model:

“Notwithstanding that decisions will be made on 1 June concerning the proposed targeted rate, we are genuinely interested in exploring with the industry how an industry-led and funded model for tourism promotion might be established and maintained. Depending on the scale of any industry proposal, we would be happy to entertain the possibility that an industry-funded model could replace a targeted rate, either in part or in full.”

Mr Roberts says the Mayor’s office knows they got it wrong with the targeted rate, yet are still prepared to go ahead with it for this year.

“It is naive in the extreme to slap a massive cost imposition on a group of ratepayers and then expect them to sit around the table with you to sort out the mess.

“Our accommodation members have made it clear that if the rate goes ahead goodwill will have been destroyed.”

Mr Roberts says there is only one way for the Council to proceed.

“Drop the targeted rate, which was never fair or sensible, and fund ATEED this year the same way it has always been funded, through general rates. That will allow the Council to sit down with all the interested parties across Auckland and work on a fair and sustainable model to be implemented from next year.”

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