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Proposed Short Stay Levy Risks Visitor Economy, DST Warns
Destination Southern Tasmania (DST) is urging the Tasmanian Government and all Members of Parliament to rethink the proposed Short Stay Levy (SSL), warning that the levy in its current form risks undermining the state’s visitor economy while failing to deal with the underlying causes of Tasmania’s housing challenges.
What is the Short Stay Levy?
The Government has released a Draft Short Stay Levy Bill and Discussion Paper proposing a 5 per cent levy on short‑stay accommodation in Tasmania, with commencement planned for 1 July 2026 subject to the passage of legislation. The levy would apply to stays of less than 28 nights, including accommodation advertised on major platforms and other eligible short‑stay providers, with revenue intended to support housing and first home buyer initiatives.
DST’s position
DST has lodged a submission opposing the Short Stay Levy in its current form, while acknowledging the need to improve housing outcomes for Tasmanians. DST argues that the levy is poorly targeted and risks eroding Tasmania’s competitiveness as a visitor destination by adding a new tax to a narrow segment of the accommodation market, rather than taking a system‑wide approach to housing and tourism. The submission also notes that many operators are still rebuilding after years of disruption and cost pressures, and that additional charges on visitors and residents could dampen demand and impact regional communities that rely on tourism.
Key concerns
DST’s submission highlights three main concerns with the proposal:
It risks undermining the visitor economy by increasing the cost of visiting Tasmania relative to competitor destinations, putting at risk jobs and small businesses dependent on visitor spending.
It imposes extra costs on visitors and Tasmanian residents who rely on short‑stay accommodation for work, health, education and family reasons, at a time of acute cost‑of‑living pressures.
It does not address the structural drivers of Tasmania’s housing constraints, such as planning, land release, construction capacity and broader investment settings, and risks creating new distortions without materially increasing long‑term supply.
DST is also concerned that placing collection and remittance obligations on the entity taking the booking may advantage large global platforms over small, locally owned operators and regional booking channels.
A better way forward
DST is calling on the Tasmanian Government to reconsider the design, purpose and revenue allocation of the Short Stay Levy before the legislation progresses further through Parliament, and to work in genuine partnership with industry and regional stakeholders. DST is advocating for policy settings that support both housing outcomes and a strong, sustainable visitor economy, are clearly linked to additional housing delivery, minimise unintended consequences for regional communities and small operators, and maintain Tasmania’s competitiveness as a destination.
Find out more
The Draft Short Stay Levy Bill 2025 and Discussion Paper are available on the Department of Treasury and Finance website, and DST’s full submission can also be accessed online. DST encourages operators, businesses and community members to familiarise themselves with the proposal, read the submission in full, and engage with their local Members of Parliament about the likely impacts on their business and region.