One of the most beloved overseas holiday spots for Australian travelers is set to become costlier starting next month, after Fiji’s government approved a new tourism-focused tax as part of its 2026-27 national budget. The new 5% levy, scheduled to take effect on September 1, applies to large tourism operators — including accommodation providers, cruise lines, and tour companies — with annual turnovers exceeding FJ$2 million, equal to roughly AU$1.3 million.
Fiji remains a top 10 most popular international holiday destination for Australian tourists, and industry leaders from across the Australia and New Zealand travel sectors have raised urgent warnings that the additional tax burden will ultimately be passed on to visiting travelers. Critically, the levy applies to all trips starting on or after September 1, including bookings that were finalized and paid for long before the new tax was approved, a provision that has drawn fierce condemnation from major travel industry associations.
Dean Long, chief executive of the Australian Travel Industry Association, issued a scathing rebuke of the policy, arguing that its structure and rollout demonstrate a fundamental lack of understanding of how the global travel booking system operates. Once a traveler pays for a holiday package, the price is locked in, Long explained, meaning the retrospective application of the new levy leaves operators and travelers in an untenable position. Sending an additional bill after a booking has already been paid is not legitimate tax policy, he said, but rather a broken promise to travelers who chose Fiji as their holiday destination in good faith.
Long added that the unclear rollout will create widespread confusion for travelers with pre-booked trips starting after the September 1 implementation date, and that both consumers and local travel businesses will bear the cost of the policy’s flaws. Julie White, chief executive of the Travel Agents’ Association of New Zealand, echoed these criticisms, noting that the only fair outcome would be to exempt existing pre-paid bookings from the new levy through a grandfathering clause.
Fijian officials have defended the new measure, explaining that all revenue generated by the levy will be specifically allocated to support Fiji Airways, the country’s national flag carrier, which is still working to rebuild its operations and financial stability after devastating disruptions caused by the COVID-19 pandemic. Officials project the levy will generate approximately FJ$70 million, equal to AU$44.7 million, to fund the airline’s recovery.