Australia’s tourism industry has erupted over a surprise Federal Budget move to hike the Passenger Movement Charge (PMC), warning the increase will make overseas travel more expensive for Australians and deter international visitors.
The Federal Government will lift the departure tax from $70 to $80 per passenger for anyone leaving Australia by air or cruise ship — a move the Tourism & Transport Forum says blindsided the industry.
TTF CEO Margy Osmond labelled the increase a “major blow” at a time when operators are already grappling with soaring fuel prices and rising operating costs.
“This is an absolute shocker for the tourism industry,” Ms Osmond said.
“The Government talks constantly about supporting tourism and growing visitation, yet tonight’s Budget makes Australia more expensive to visit and more expensive for Australians to travel.”
The new $80 PMC means a family of four will soon pay $320 in departure taxes as part of their trip costs.
TTF said the lack of consultation with industry before the announcement added to the frustration, arguing the six-month transition period shows the Government understands the scale of the impact.
Ms Osmond is calling for the increased rate to be frozen for at least four years to give tourism operators certainty amid ongoing market volatility.
She also accused Treasury of turning the PMC into a “revenue grab”, claiming billions collected from travellers are not being reinvested into tourism, aviation or border infrastructure.
“It’s inconceivable that none of the extra revenue from this tax hike appears set to fund the urgent border modernisation we’ve been calling for,” she said.
The industry has spent the past 18 months working with government agencies on plans for a “seamless border” experience, but TTF says airports still lack clarity about future infrastructure investment.
Ms Osmond warned Australia risks falling behind other countries already rolling out faster, smarter border processing systems.
“Right now, airports around the country are planning improvements and they need a clear signal on how they should invest,” she said.
“It is urgent that we build on the strong work already underway and deliver the modern seamless border experience that so many other countries now take for granted.”
Cruise sector warns of competitiveness hit
Adding to the criticism, Cruise Lines International Association (CLIA) warned the higher PMC would further damage Australia’s competitiveness at a time when the nation is already losing cruise business to other regions.
“Increasing the Passenger Movement Charge places yet another burden on travellers at a time when the tourism community is working hard to overcome challenges at home and overseas,” CLIA said in a statement.
The cruise industry body said Australia already imposes some of the world’s highest travel-related charges, creating a disincentive for international visitors and adding to the cost of overseas travel for Australians.
CLIA said the increase was particularly disappointing as the cruise sector continues to highlight the loss of cruise tourism from Australia to competing international destinations.
CLIA has also backed calls for PMC revenue to be reinvested into modernising Australia’s aviation and cruise border systems.
