Bills Digest No. 223  1997-98 Passenger Movement Charge Amendment Bill 1998


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WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History
Purpose
Background
Main Provisions
Endnotes
Contact Officer and Copyright Details

Passage History

Passenger Movement Charge Amendment Bill 1998

Date Introduced: 28 May 1998

House: House of Representatives

Portfolio: Industry, Science and Tourism

Commencement: 1 January 1999

Purpose

To increase the rate of the Passenger Movement Charge from $27 to $30.

Background

The Passenger Movement Charge (previously called the Departure Tax) was introduced by the Passenger Movement Charge Act 1978. It is a charge levied on passengers leaving Australia for an overseas destination and is collected by airlines and shipping companies as part of their ticketing arrangements.

The original rate of the charge was $10. This was increased to $20 in 1981, but then reduced to $10 in 1988. In 1991 the rate was increased to $20, and to $25 in 1994. It was further increased from $25 to $27 in 1995 when the name of the charge was changed from 'departure tax' to 'passenger movement charge'. This Bill seeks to increase the charge by another $3 to $30 from 1 January 1999. Announcement of the change was made in the Budget.(1)

Revenue collected from the passenger movement charge totalled $200 million in 1997-98 and is estimated to raise a total of $217 million in 1998-99.(2) The $3 increase will raise an estimated $77.3 million in additional revenue over the four years to 2001-02.(3)

The money raised from the passenger movement charge is used to recover the costs of processing international travellers through customs, immigration and quarantine procedures at Australia's borders, and the costs of issuing short-term visas. Some of the revenue from the $3 increase in the charge will go towards meeting additional costs associated with the movement of people and goods expected for the Sydney 2000 Olympic Games.(4)

Revenue raised by the passenger movement charge has also been used to help promote tourism to Australia. In the 1998-99 Budget documents, the proposal to increase the charge was linked to additional funding for tourism promotion and development totalling $58 million over four years.(5) The Australian Tourist Commission is to receive an extra $50 million to encourage more tourism from existing markets such as Europe and North America. $8 million is to be spent over four years on initiatives and infrastructure to develop and promote regional Australia as an attractive tourist destination.(6)

The proposed increase in the Passenger Movement Charge has excited little comment. The Tourism Council of Australia has been reported as saying that the tourism industry can 'live with the increase...given that this is the first time the charge has been increased since...1995'.(7)

Main Provisions

Item 1 of Schedule 1 increases the rate of the Passenger Movement Charge from $27 to $30. The amendment will apply to those passengers leaving Australia on or after 1 January 1999 (Item 2).

Endnotes

  1. Budget Speech, House of Representatives, Debates, 12 May 1998, 3008.
  2. Budget Strategy and Outlook 1998-99, (Budget Paper No.1), 5-11.
  3. Budget Measures 1998-99, (Budget Paper No.2), 2-19.
  4. Ibid., 2-20.
  5. Ibid., 1-74.
  6. 'Asian tourist decline spurs big spending on visitor promotion', Age, 13 May 1998, B12.
  7. Senator N Minchin in answer to a Question Without Notice, Senate, Debates, 14 May 1998, 2754.

Contact Officer and Copyright Details

Rosemary Bell
1 June 1998
Bills Digest Service
Information and Research Services

This paper has been prepared for general distribution to Senators and Members of the Australian Parliament. While great care is taken to ensure that the paper is accurate and balanced, the paper is written using information publicly available at the time of production. The views expressed are those of the author and should not be attributed to the Information and Research Services (IRS). Advice on legislation or legal policy issues contained in this paper is provided for use in parliamentary debate and for related parliamentary purposes. This paper is not professional legal opinion. Readers are reminded that the paper is not an official parliamentary or Australian government document.

IRS staff are available to discuss the paper's contents with Senators and Members
and their staff but not with members of the public.

ISSN 1328-8091
© Commonwealth of Australia 1998

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1998.



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