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Legislative Assembly for the ACT: 1997 Week 9 Hansard (3 September) . . Page.. 2829 ..

Bed Tax

MRS LITTLEWOOD: Mr Speaker, my question is for the Minister for Tourism. Does the Minister agree with the ACT Council of Social Service paper seeking the introduction of a bed tax in the ACT?

Mr Moore: Oh, an excellent paper! I will help with a supplementary question.

MR SPEAKER: Would you be quiet, Mr Moore.

MR KAINE: Perhaps Mr Moore would like to answer the question, Mr Speaker. Bluntly, the answer is no. Given the new directions being taken by the Opposition, I imagine that their answer to the same question would also be no. The reasons, I think, are pretty obvious. Last year, 1996-97, hotels, motels and guesthouses in the ACT generated $76.5m in accommodation income. This figure does not take into account the expenditure generated through wages and salaries incomes and expenditure associated with hotel suppliers. It is just the amount that those establishments took for accommodation charges.

I see this revenue as the backbone of the local tourism industry in the ACT. I think Mr Corbell and the rest of them over there would have to agree that that is the case. The introduction of an across-the-board bed tax would severely slash the revenue base of the ACT accommodation sector. There is no question about it. Associated reductions in the secondary expenditure of hotel employees and hotel suppliers would, of course, have a ripple effect on the local business income right across the board.

A survey two years ago by the Tourism Council of Australia revealed that 55 per cent of travellers responded that they would re-evaluate their travel plans if a bed tax were introduced. While this was a national survey, the implications for individual States and Territories cannot be ignored. These figures indicate that the impost of a bed tax would inflict serious damage on local tourism industries. Of course, the consternation in the tourism industry in Sydney when the Carr Government imposed such a tax recently speaks for itself. The same thing would apply here.

In the ACT the tourism industry contributes over $300m to the local economy every year. I ask Mrs Littlewood and others: Can you imagine the devastating effect on the local industry if 55 per cent of tourists to the ACT re-evaluated their travel plans in line with the proportion suggested by the Tourism Council of Australia survey? Of course, it would not have to be that large to have a significant impact on the ACT anyway. In today's business climate the emphasis is on competition, and tourism is no exception. Those regions which become uncompetitive are simply going to lose out in the tourism race.

Mr Speaker, I have to ask ACTCOSS whether they would be prepared to accept that any reduction in tourism numbers - even 5 per cent, let alone 55 per cent - will result in reduced inputs to the ACT economy and the loss of jobs in the tourism industry, particularly amongst youth, a lot of whom work in the tourism industry. I do not think ACTCOSS can be serious about that, and I certainly do not accept it. In putting forward

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