By Rebecca Ingram, Chief Executive, Tourism Industry Aotearoa
As published in The Post, Stuff - 27 October 2025
The state of New Zealand’s infrastructure, and funding to address our growing needs, is a common topic of discussion. It’s no different in tourism. One idea that regularly makes headlines is the call for a local bed tax, often positioned as a quick fix for some of our popular visitor destinations.
However, the reality is far broader and complex. The New Zealand tourism industry is already engaged and focused on this conversation – and agree that solutions need to be balanced and strategic, addressing all of Aotearoa New Zealand, not just one or two locations under pressure.
Tourism doesn’t exist in a vacuum. It supports regional jobs in towns and cities across the country, brings export earnings, fuels small business and helps keep communities thriving. When tourism thrives, so does New Zealand. The industry directly contributes around $17 billion to GDP each year – roughly five per cent of the national economy – and creates more than 300,000 jobs, many in regional areas where few other industries reach. Tourism is unique amongst our export industries as the only one that pays GST. 62% of tourism spend is from New Zealanders and 38% is from international visitors.
Visitation can create infrastructure and community pressures, which are often more pronounced over the busy summer season when Kiwis are off on a well-deserved break and the majority of international visitors arrive. Local councils, especially in popular visitor places, are underfunded to respond, and our industry recognises this.
We are supportive of new mechanisms to ensure we can address these pressures. What we believe is needed is a systematic, fair funding solution that works nationwide, includes industry in its governance and delivers long-term benefits. Any new funding mechanism should be uniform across the country, so it’s fair, simple to administer and is enduring. We support and want a wider, innovative conversation about funding, one that that will serve New Zealand well for decades to come.
We’ve already thought this through. In our industry strategy, Tourism 2050: A Blueprint for Impact, we recognise that tourism requires the right funding, levers and data if it is to deliver for New Zealand. One of the 10 key actions is to address industry funding – ensuring the industry can invest in tourism related infrastructure, capability building, destination management, knowledge and climate-change adaptation. The government’s recently announced Tourism Growth Roadmap complements this strategy; we welcome it and look forward to being part of its detail.
That brings us to the most immediate lever: the International Visitor Levy (IVL). The IVL is already in place as a mechanism to help fund tourism-related needs. But its potential lies in how we use it.
While TIA was not supportive of a significant increase due to the brakes it could place on demand, when the Government raised the IVL from NZ$35 to NZ$100 there was an expectation the substantial funds generated, estimated at $1billion over five years, would be used to make tourism related improvements.
At TIA we take the view that the IVL should be used to improve our communities and our visitor experience – with the intended 50/50 split providing essential investment in tourism related infrastructure and the Department of Conservation – not simply as savings to replace core funding.
What we’re advocating for is using the IVL now to deliver transformation, while designing a well governed national funding mechanism for tourism infrastructure and destination management.
What does this mean for communities and regions? In places such as Queenstown, where domestic and international visitor numbers along with population growth are outpacing infrastructure (for example, the local population has doubled in 14 years) the tensions are real and acknowledged.
Research shows that while 94 per cent of New Zealanders believe tourism is good and 83 per cent say it’s good for their region, 72 per cent have reported local impacts. That underlines the challenge: it’s not whether tourism is good, but whether it is well managed.
A balanced funding model enables investment in new roads, parking, visitor-flow management, local amenities and public services – all of which benefit local communities as well as overseas visitors. It provides the financial means for regions and boosts places that have growth aspirations. It helps shift from reactive to designed growth. Our tourism industry stands ready to collaborate across national, regional and local levels to make this happen.
Our message to all Kiwis is this: we support calls for national funding solutions. We believe visitors contribute broadly and positively to New Zealand. We’re striving for a system where industry, government and communities work together, where the money flows where the impact is highest, and where investment is shared so the benefit is shared.
With the right funding in place, we’ll ensure tourism works for everyone, now and for generations to come.
