Accommodation prices expected to rise as carbon tax kicks off

The hospitality industry will 'undoubtedly' feel a down turn in business, according to the Accommodation Association of Australia chief executive Richard Munro, as the new carbon tax takes effect.

The accommodation leader explained the cost of transport for holiday and business travellers will lead to reconsideration on the amount spent on hotels in both the leisure and business categories.

Although operators will be responsible for deciding the hike in cost, Mr Munro has estimated an overall three percent jump in accommodation cost.

"... we are likely to see increases in room rates as a result of the carbon tax because the costs to accommodation operators to run their businesses will increase," Mr Munro said.

"This is particularly due to hikes in the cost of electricity prices."

Mr Munro added that the tax was particularly "disappointing" to the industry, as "for several years" it had worked towards introducing measures to counter emissions, and control recycling, energy and air conditioning.

"Although there are government payments to consumers to offset the impact of the tax, not every Australian is eligible for these," he added.

"We are concerned that paying even more taxes will be a disincentive to travel and holiday within Australia, which is counterproductive to stimulating our local economy and encouraging the support of our domestic accommodation and tourism industry."

Source: eTravel Blackboard, 2 July 2012