Issues & Trends – July 2011
INDUSTRY DISMAYED BY CARBON TAX PLANS
Forecasts of business collapses, route closures, job losses
THERE is dismay within the tourism industry that the Federal Government’s carbon tax proposals do not contain measures to compensate companies for the adverse impacts on tourism businesses.
“The Government has outlined a number of compensation measures to support industries highly exposed to the carbon tax, but where is tourism?” asked Australian Tourism Export Council managing director Felicia Mariani.
“The Australian tourism industry has been left out of the equation again with the Federal Government’s carbon price scheme providing no assistance or support to an export industry highly vulnerable to competitive pressures and already operating on slim profit margins.”
Mariani said the carbon tax will increase operator costs, driving some out of business.
“The Australian tourism product is already seen as expensive with the high dollar and travel costs, this tax will add a further burden to our price competitiveness and make Australia an even less affordable place to take a holiday,” she said.
She said operators such as dive companies on the Great Barrier Reef will face particular hardship under the new fuel taxes, with no recourse to compensation.
With the carbon tax applied to domestic, but not international flights, Mariani forecast the closure of some routes with a flow on effect for regional tourism operators.
The Tourism and Transport Forum (TTF) said a carbon tax without “appropriate complementary measures and transitional assistance” will accel-erate the gap between the numbers of Australians travelling overseas and the numbers of international visitors coming to Australia.
TTF chief executive John Lee said the latest TTF-MasterCard Tourism Industry Sentiment Survey found that 78 per cent of tourism operators believe the carbon tax will have a medium to high impact on their business.
While supporting moves to reduce carbon emissions “in principle”, he called for “complementary measures and transitional assistance” including GST-free status for leisure travel packages bought by overseas visitors.
Lee added that the Government should confirm “as soon as possible” the details of tax breaks for the Green Buildings Scheme, amend tax depreciation rules for tourist accom-modation and reduce the effective life of aircraft for tax purposes to three years.
On the retail front, AFTA chief executive Jay Westbury has warned the proposed carbon tax “will not be good for our industry”. (See AFTA View).