Fiji Departure Tax Hike Not Expected To Hurt Tourism

Visitors unlikely to be put off by increase, says academic

WELLINGTON, New Zealand (Radio New Zealand International, Nov. 18, 2013) – The Fiji Government is hiking its departure tax by more than US$25, but players in the tourism industry don’t believe that will stop tourists visiting the popular travel destination.

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As part of its budget, the Government has announced its airport departure tax will increase from US$81 to US$108 from January next year.

As Amelia Langford reports, Fiji’s new departure tax is far higher than its direct competitors, including Samoa and the Cook Islands.

Nearly $US3 of the tax will go to the Civil Aviation Authority of Fiji and five dollars will be given to Airports Fiji Limited. The tax, which is included in the price of the ticket, will also include a five-dollar environment levy. New Zealand’s largest travel agency, The House of Travel, says the hike probably won’t have too much of an effect on tourist numbers. Here’s its commercial director, Brent Thomas:

“BRENT THOMAS: Well, obviously we don’t like to see any prices moving up – it’s adverse for the consumer. However, given the relatively small size and given the popularity of Fiji as a destination we don’t believe it is going to materially affect the number of New Zealanders going to Fiji over 2014.”

Brent Thomas says Fiji caters to all travellers from the budget-conscious to fans of luxury five-star hotels. But he also says the holiday market in the Pacific is very competitive and price-sensitive.

“BRENT THOMAS: When you add it up for four people going away, you know, it certainly does become a little bit more expensive and that’s where Fiji will need to be careful in terms of its overall pricing relative to other islands and other destinations. Having said that, people love Fiji and it will continue to be a very popular destination for New Zealanders.”

In contrast to Fiji’s increased tax of US$108, the Cook Islands tax is about US$54, Samoa’s is US$28 and Tonga’s is US$30. But a professor of economics in Fiji, Biman Prasad, believes tourists will happily absorb the extra cost.

“BIMAN PRASAD: It is something that the tourists can afford and people who travel are usually people who are not very poor and so raising revenue and earmarking it for some environmental and other policies is not a bad idea in my view.”

But one of the directors of the Maqai eco-surf-resort, Shaw Mead, says further hikes would be cause for concern.

“SHAW MEAD: It is getting quite substantial, that is a bit jump as well at 25 percent, so, yeah, if it kept going I’m sure there would be some kickbacks all over the place. There are other tropical paradises in the Pacific for sure.”

Auckland University of Technology’s Tourism Research Institute director says it is a fairly substantial increase but will be invisible to most travellers since it is embedded within the ticket price. But Professor Simon Milne says he would like to see more details about where the environmental levy will go.

“SIMON MILNE: I guess the question really has to be asked though – will this money go into a specific environmental protection fund or is it really just a bit of lip service being paid and the money is just going to go into the general Government coffers anyway? That’s not overly clear to me at the moment.”

Simon Milne also says the local tourist industry is no doubt disappointed by the hike.

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