The Tourism Export Council of New Zealand (TECNZ) has voiced concerns about the recent rise in visitor visa fees implemented by Immigration New Zealand. The council fears that the increase could hinder New Zealand’s efforts to recover its international tourism sector, which has been struggling to rebound after the COVID-19 pandemic.
TECNZ Chief Executive Lynda Keene stated that the council had previously submitted feedback on the proposed fee increases, advocating for a 50% reduction. While the proposed increase for group tour fees was reduced, Keene expressed concerns that the standard visitor visa fee and working holiday visa fee increases could be significant enough to make New Zealand a less attractive destination for potential visitors.
The council, alongside Tourism Industry Aotearoa (TIA), believes that raising visitor visa fees during the ongoing tourism recovery is ill-timed. The inbound sector and airlines typically plan their itineraries and ticket prices one to two years in advance. This makes it crucial for New Zealand to provide ample notice to potential visitors so they can make informed decisions and secure travel plans. While acknowledging the need for some cost recovery for visa services, TECNZ emphasizes that the current timing for full fee recovery could be detrimental to the growth of the tourism sector in offshore markets.
The council would have preferred to see fee increases postponed until October 1, 2025. The fee hike is expected to particularly impact high-growth markets like India and China, which are crucial for New Zealand’s tourism recovery. These markets are known for their sensitivity to price changes, and the fee increase could have a significant negative effect on their travel decisions.
TECNZ’s previous forecast in April 2024 projected that international arrivals would reach 88% of pre-COVID levels by the end of March 2025, with a full recovery by March 2026. However, the council’s latest forecast, released in August 2024, has revised its expectations based on lower-than-expected airline bookings and a softening in several markets. While markets like the US, Australia, India, and Canada have shown strong performance, the council is observing a slight decline for the 2024-2025 season. Specifically, the holiday segment remains at 75% of pre-COVID arrivals, indicating that further efforts are needed to improve this figure.
The council now anticipates that recovery will reach 85% by the end of May 2025, 96% by May 2026, and a full return to pre-COVID levels by May 2027.
TECNZ also highlights that the International Tourism Conservation & Visitor Levy (IVL) is currently under review. Considering the recent increases in border, customs, and immigration fees in 2024, the council urges the government to postpone the IVL review until pre-COVID arrival numbers are achieved. If an increase is deemed necessary, TECNZ recommends implementing it in 2025 or 2026.
The council emphasizes that New Zealand needs to remain proactive in attracting tourists, as it cannot assume that visitors will come regardless of the cost. Offering an attractive and affordable proposition is crucial to encourage travelers to choose New Zealand over other destinations. In a highly competitive global market, maintaining competitive pricing and compelling travel options is essential for keeping New Zealand on travelers’ itineraries.
