Australia’s accommodation and tourism sectors have welcomed support for Tourism Australia and Rex Airlines in the Federal Government’s 2025-26 Budget but noted a lack of broader support for tourism initiatives and business recovery.
Tourism Australia funding remains unchanged at approximately AU$153 million, with the Government committing to $130 million in secured loans to keep Rex Airlines operational during its extended voluntary administration to 30 June 2025, as a sale process is underway.
Accommodation Australia CEO James Goodwin is hopeful that the consumer-focused initiatives in the Budget will encourage more spending on travel and stays.
“This was a Budget aimed directly at voters and addressing cost of living pressures – we hope that if consumers have more confidence to travel and participate in the visitor economy this will flow through to stronger demand for the tourism and accommodation sectors,” Goodwin told HM.
“It’s good to see funding for Tourism Australia is maintained in the Budget, there’s some additional funds to increase our engagement with emerging tourism markets like India and some support measures for small business which will benefit some of our members.”
The Australian Tourism Export Council (ATEC) welcomed the continued support for Tourism Australia, which it says plays a critical role in marketing Australia to the world and driving international visitor demand.
“Securing consistent funding for Tourism Australia is essential for effectively promoting destination Australia, which is crucial for the industry’s recovery and long-term growth,” said ATEC Managing Director, Peter Shelley.
“As the industry rebuilds in a changed global environment, businesses are adapting to more diverse markets and travellers which require not just strong marketing, but targeted support to compete and grow.
Shelley said the support for Rex Airlines is a positive step that recognises the critical role regional aviation plays in supporting Australia’s tourism industry, but called for greater investment to rebuild Australia’s international visitors numbers, which were approximately 13% below 2019 figures last year.
“As one of Australia’s leading export sectors, tourism needs targeted investment to rebuild international distribution networks, strengthen aviation access, and address persistent workforce shortages,” Shelley said.
“With an election on the horizon, we urge all parties to prioritise policies that support Australia’s export tourism industry and the thousands of businesses and jobs it sustains.
“Through well-targeted policy commitments, they can directly support the growth of our international tourism industry – delivering greater success for the Australian economy.”
The Budget contained no increase in the Passenger Movement Charge (PMC), which remains at a record $70 per international passenger. The PMC now collects over $1 billion in tax revenue, according to the Australian Tourism Industry Council (ATIC), which is advocating to continue to freeze the PMC until international visitors have recovered.
The Budget forecasts net overseas migration to drop from 335,000 this year, to 260,000 next year, and then 225,000 the year after, while temporary migrants are forecast to drop by 75,000 in the next financial year. This will be driven by caps on international students and working holiday makers return home following the post-Covid surge