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Wednesday, March 26, 2025

Sir Bob Jones: The taxation enigma


One of our very best financial journalists is the Herald’s Fran O’Sullivan.

In a deservedly scathing attack on the insanity of the government’s recent introduction of $100 tourist Visa fee for Chinese visitors, Fran trotted out some hard statistical facts. These are,

1) Chinese tourist numbers are lagging.

In the 12 months to October 2018, 451,344 Chinese tourists arrived. Last year almost half that number (245,305) came.

Since our introducing the Visa fee Chinese tourists to Australia rose by 30% while declining in New Zealand.

2) Singapore wiped their Visa fee for China in early 2023, resulting in an immediate 80% increase.

Research shows the average Chinese tourist visiting New Zealand spends $6537.

Given that readers might well say $100 should make no difference, but if so then they’re overlooking a significant reality.

That is, we humans are never robotically rational in our behaviour.

Instead, emotions, prejudices and such like factors interfere and never moreso than with expenditure, often seen as a rip-off, no matter how trivial the amount. On the other side of the coin, consider this.

Nepal has just lifted the permit fee to climb Mount Everest in the summer months, from US $11,000 to US $14,000. The fee is cheaper in the winter months.

Circa 1,000 people attempt it annually, but note this, going it alone inevitably sees deaths. To succeed safely most climbers pay companies to escort them, depending on the time of the year, at a cost of up to a third of a million NZ dollars. No matter the cost the silly buggers keep coming, simply for bragging purposes.

Now compare visiting New Zealand at a fee of $100, as opposed to no fee for say Australia.

Irrationally though it plainly is, as Fran has pointed out, it nevertheless acts as a deterrent for unlike climbing Everest there’s no sense of accomplishment.

Some cities such as Paris, London and New York often boast of their tourism earnings.

I question these figures. The real value from tourism is in providing numerous low-paid jobs in restaurants, driving tourist buses and so on for in many cases people who would otherwise be unemployable and a cost on the state.

Such is the complex nature of modern society. But assuming rationality in human behaviour is always a huge miscalculation in ignoring the reality of our more common irrationality.

Sir Bob Jones is a renowned author, columnist , property investor, and former politician, who blogs at No Punches Pulled HERE - where this article was sourced.

2 comments:

Robert Arthur said...

From my extensive observation of the many mostly immigrant Chinese at local markets, they are more attuned to a good buy than anyone else. They and their similarly programmed countrymen would certainly note a random surcharge. (Incidentally, despite the large number on benefits and so with free time, maori are not in great numbers at these markets where produce is often half supermarket price. And when they are present, the overweight children and all tucking into fast food and commercial sweets would seem to offset any savings.)

CXH said...

The Chinese tourists are good for NZ. They buy the package in China. They travel on Chinese owned tour companies. They go to shops with Chinese staff that offer the tour leader kickbacks.

Off course we need thousands more.