LGNZ has joined a chorus of calls, including from the tourism industry, for the Government to share funding collected through the International Visitor Levy (IVL) with local councils to reduce pressure on ratepayers.

This comes after an investigative report by the New Zealand Herald uncovered the Government’s intention to use IVL revenue to subsidise Crown funding, after initially saying this funding would be adding to - not replacing - what is spent in the tourism and conservation sectors.

The purpose of the IVL was to help maintain the facilities and natural environment tourists use and enjoy during their stay, and the bulk of this responsibility is borne by councils. The IVL was raised by $65 per person for most international visitors from 1 October 2024, with the Ministry of Business Innovation and Employment (MBIE) previously estimating that the additional IVL revenue will raise between $127 and $173 million annually.

“New Zealand continues to experience increasing numbers of international visitors, this growth in visitor volume has challenged New Zealand’s basic infrastructure, environment, and the social licence for tourism to operate in certain areas,” says LGNZ President Sam Broughton.

“The IVL should be used to reduce pressure on communities, so councils can accelerate investment in pipes, roads and transport. It’s disappointing to see the Government has chosen to impose an extra tax on international visitors to improve the Government’s budget.”

“Tourist destinations see their populations more than double with visitors, placing a massive burden on the basic infrastructure that communities are currently self-funding through rates.

“We’re calling on Government to do the right thing here and distribute the $65 increase per tourist from these IVL charges onto councils.”

Sam says that this call is backed by public sentiment.

“Last year LGNZ released a poll that showed almost 80% of New Zealanders think tourists should be contributing toward the local infrastructure and services they use. The best and fairest way to do this is by passing a portion of the IVL revenue onto councils.”

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