Budget 2023: Jim Chalmers increases fee paid by international travellers to leave Australia

International travellers will be slugged extra on their trip to Australia after the government increased a little known charge in this year’s budget.

Inside Treasurer Jim Chalmers’ Tuesday budget was an increase to the Passenger Moving Charge (PMC) – a fee to cross our international border – from $60 to $70, to come into effect in July 2024.

The PMC was first introduced in 1978 at $10 and is used by the Commonwealth to help fund the processing of international passengers into Australia through customs. 

The fee is built into the price of travel offered by the airline, which is then passed onto the government.

Airline crew, those on cultural trips and children under 12-years-old are exempt from the fee.

Tourism organisations have slammed the 16 per cent increase as potentially further crippling the industry as it recovers from the Covid pandemic.

International travellers will have to pay more to visit Australia after an increase to the Passenger Moving Charge was announced in Tuesday’s budget (stock image) 

Tourism and Transport Forum (TTF) chief executive, Margy Osmond, described the increase as a ‘tourism tax’ that will be imposed on everyday Australians.

‘This will make it even more difficult for tourism to bounce back, as cost-of-living pressures increase and as the industry rebuilds from the devastating impacts of the Covid pandemic,’ Ms Osmond said.

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‘It will also make it more expensive for international tourists to come to Australia, at a time when we’re desperately trying to attract more visitors, with Australia’s international tourism levels still below pre-Covid levels.’

The extra $10 charge on every flight leaving Australia will generate $1.38billion in revenue in 2024/25, according to calculations by the Australian Federation of Travel Agents (AFTA).

AFTA chief executive Dean Long said that ‘now is not the time for additional taxes’ as travel activity remains 30 per cent below pre-Covid levels.

‘Today’s decision to increase the PMC by 16 per cent is extremely disappointing and will make it harder for Australian families to stay connected,’ Mr Long said.

‘We know that the PMC does reduce air capacity to Australia and with supply of air seat still tracking 30 per cent to pre-Covid levels this will slow down our recovery.’ 

Tourism organisations have described the increase from $60 to $70 in Jim Chalmers’ (pictured) budget as a ‘tourist tax’ on an already struggling industry

The industry is still struggling to recover from Covid-era border closures, with travel activity remains 30 per cent below pre-Covid levels (stock image)

Ms Osmond is calling for the government to impose a five-year freeze on future increases ‘to provide certainty for the tourism sector’.

‘As we continue to recover from the biggest event to impact the tourism industry in recent memory, the freeze will be critically important to give the industry much-needed certainty,’ Ms Osmond said.

‘The government also needs to be more transparent about how the money collected through the PMC is spent, explaining where exactly it’s allocated given the average rate of over collection.

AFTA says that the increase will cost the industry an extra $520million over the five years from 2022-23.