Photo: 123RF
Hikes in outdoor dining fees are hitting already struggling hospitality businesses hard according to their Association.
Checkpoint spoke to a Queenstown business owner on Tuesday who said his outdoor dining tax had gone from just over $3000 a year to more than $50,000.
Queenstown Lakes District Council is now charging "market rates" of 30 percent of indoor rent.
It said in a statement that the market rates unanimously adopted by councillors were assessed by an independent valuer and publicly available to view in advance of their meeting in May.
It gave businesses plenty of notice it planned to raise the fees, it said
But while there was public consultation on the policy it did not include actual fees.
The council also disputed the figures provided by the hospitality venue, saying it had been undercharged for several years due to an inaccurate calculation of the floor area.
It told Checkpoint on Tuesday it had no plans to review the charges, but was open to having discussions with the hospitality sector. It said the fees had not changed since 2006.
Tauranga City Council is charging venues based on the size of the outdoor area, but on Tuesday voted to waive the charges for the rest of the year and is offering a rebate for part of next year to acknowledge tough trading conditions.
Restaurant Association president Mike Egan told Checkpoint the amount Queenstown Lakes District Council was charging was excessive.
"Especially when you compare it to many of the other regions which have quite reasonable outdoor charges," he said.
"It's just like an outlier... way over the top.
"Many regions see the benefit of outdoor dining, and honestly, the usage is probably about 10 percent of the year. So charging sort of a percentage of indoor rates is a bit unfair because you're not using them 30 percent of the year."
Restaurant Association speaks on outdoor dining fee hikes
He added the Far North charges $288 for five tables, Hamilton charges $31 per table, Hastings is a flat rate of $320 application fee and $320 a year, Wellington is $113 a square metre plus an application fee, and Southland is $328 a year.
"Many of them are quite happy with what they charge," Egan said.
And other rising costs were already a challenge for hospitality businesses in New Zealand, he said.
"We've got people out there wining-and-dining, but it's sort of that perfect storm where a lot of our fixed costs have gone up, especially with gas and electricity, insurance and all those things.
"It is quite tricky, but there's light at the end of the tunnel and we're seeing some quite good signs of growth and positivity."
He said Queenstown Lakes District Council "definitely should rethink" its outdoor dining fees.
"What is it trying to achieve? What is it trying to make its city be like and be attractive for tourists?
"If you were asked to pay $50,000 and you've got a small cafe, you're not going to open up outside. You're just going to say, 'Look, we can't afford to do it because that will send us to the wall'.
"So the market will decide. And if Queenstown doesn't want to have outside dining, so be it."
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