Thought your travel plans wouldn’t be hit by this year’s federal budget? Think again…
Treasurer Jim Chalmers announced the government will increase the Passenger Movement Charge (PMC) during last night’s federal budget.
Criticised as an unwelcome ‘tourism tax’, the rise will see the departure charge increase from $60 to $70 from July 2024, the additional $10 fee applying to every flight leaving Australia.
Tourism and Transport Forum Chief Executive, Margy Osmond said the increase will harm Australia’s crippled tourism industry as it struggles to recover from the pandemic.
“This will make it even more difficult for tourism to bounce back, as cost-of-living pressures increase and as the industry rebuilds from the devastating impacts of the Covid-19 pandemic,” Ms Osmond said.
“It will also make it more expensive for international tourists to come to Australia, at a time when we’re desperately trying to attract more visitors, with Australia’s international tourism levels still below pre-Covid levels,” she said.
Adding insult to injury, the government is expected to pocket $1.3 billion in the first year of the increase from July 2024 to July 2025.
Ms Osmond said the PMC collected $811 million more than the funds dedicated to border processing measures in the three years before the pandemic.
“The government also needs to be more transparent about how the money collected through the PMC is spent, explaining where exactly it’s allocated given the average rate of over collection,” she said.
What is the Passenger Movement Charge?
Australia’s Passenger Movement Charge is a departure tax paid directly to the Australian Government.
The charge applies to anyone leaving Australia for another country, regardless of whether the traveller intends to return.
As such, the PMC applies to Australian-based travellers as well as overseas tourists and is an additional fee for anyone already applying for a student or working holiday visa.
Summing up: Right off the money
The decision to increase the PMC sees the Australian Government moving in a very different direction to other counties, many of which are charging less to attract visitors.
Travel halts during the pandemic saw Australia experience a widespread shortage in farm workers, so it’s interesting the government would introduce an additional charge that we can only assume will make a working holiday less accessible.
Australia’s tourism industry is now calling for a five-year freeze on any future increases to provide certainty for the tourism sector – an important halt that will give the industry some much-needed certainty.
Do you think it’s a good time to slap more taxes on travellers?
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