Onerous security tax will hit passengers

By Graeme Kennedy

Friday 7th May 2004

Healthy competition has begun driving down the cost of transtasman travel but now onerous new taxes will drive it up again.

Departure tax at international gateways will rise as a result of a massive new security tax; the question is by how much?

Under one clearly unfeasible option in the government's border security cost recovery proposals, international passengers flying out of Queenstown would pay a departure charge of about $225.

And the price to leave the country would rise from $25 to $45 at Auckland, $70 at Hamilton and $95 at Palmerston North.

The government suggests in its discussion document on airport security cost recovery that charges might be based either on actual individual airport costs or as a single nationwide rate.

Customs, MAF and security costs are far lower at major airports such as Auckland, which have higher passenger volumes than at regional international gateways.

The discussion document asks if there should be a review of the entire border security funding issue and whether the Crown or airline passengers should pay.

Under current arrangements the industry pays $11.4 million for aviation security, $5.4 million for customs services and $1.6 for immigration while the Crown contributes $14.3 million for Customs, $18.6 million for MAF and $3.2 million for Immigration.

All departing passengers now pay a $25 charge, of which $4 is for security, $1 for the Civil Aviation Authority, about $17 for airport development and the remainder in GST.

New security measures include hold baggage screening to cost $14.3 million, enhanced Customs passenger processing $5.4 million and Immigration another $1 million.

The government is due to start consulting with the travel industry, airports, airlines, the Board of Airline Representatives NZ (Barnz) and consumer organisations on May 20.

Barnz executive director Stewart Milne said border security should be Crown-funded as it was for the benefit of New Zealanders.

"And airlines have shown that a drop in the price of travel has a huge impact on the market," Milne said.

"Air New Zealand proved that with its domestic express class and Tasman express fares and if the government goes ahead and puts security costs on the industry, the opposite will occur."

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