A court case against Auckland Council about its 'bed tax' has been dismissed, with Auckland Mayor Phil Goff saying he's please but not surprised.
The so-called "bed-tax" was given the green light in June 2017, which implements a targeted rate on commercial accommodation providers based on their capital value.
The targeted rate was implemented by Mr Goff in what he described as a "common sense tool".
But in May 2018, Auckland Council was served with legal proceedings challenging the decision by the council to establish the rate.
On Wednesday, the Auckland High Court dismissed an application for a judicial review of the Accommodation Provider Targeted Rate (APTR) in a decision by High Court Justice Simon Moore.
The APTR is charged to hotels, motels, serviced apartments and online accommodation providers that are rented for more than 28 nights per year on websites like AirBnB and Bookabach. The revenue raised is used to help fund the activities of Auckland Tourism, Events and Economic Development (ATEED), the council agency tasked with growing Auckland’s visitor economy.
One owner says the targeted rate is unfairly being placed on a small group of society. (Source: Other)
"The targeted rate is a common sense tool that ensures accommodation providers who directly benefit from tourism are contributing to the costs associated with promoting events and marketing Auckland to the world," Mr Goff said in a statement today.
"When we introduced the targeted rate, we did so in a fair and transparent manner, following significant public consultation and good faith engagement with the accommodation industry. More than two thirds of Aucklanders who submitted on the rate supported it.
"Tourism has been booming. It is only fair that those benefitting from ratepayer funded tourism promotion pay a fair share rather than that cost falling entirely on ratepayers."
New Zealand's roads, car parks and sewage systems are straining from record visitor numbers. (Source: Other)
Mr Goff said he was pleased the court found that the decision to set the targeted rate was not unreasonable, that the council was not in breach of the Local Government Act.
As well, Finance and Planning Committee Chair Desley Simpson said, "I am really pleased with the decision from the courts. It is a testament to the hard work of all our staff who have worked on this for a while. I am now looking forward to getting on with the Annual Plan and 10-year budget process."
Among the coming events, in part funded by the rate, are the World Rally Championship, the Round the World Ocean Race stopover, the Women’s Rugby World Cup, the annual Winter Festival and events such as the NZ Fashion Week.
It is expected the events will bring thousands of visitor bed nights to the city.
The new rate will be passed onto around 330 Auckland hotels, making some of their owners furious. (Source: Other)
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