Working holidaymakers spend $2.3 billion each year, says ATEC (Image Guardian Unlimited)

Will a likely rise in the cost of tourist visas spell the death of backpacking in Australia? Not quite. But it will make those rucksacks feel a little heavier when young travellers arrive on Aussie shores having to fork out more than they had bargained for.

With Australian outbound travellers currently exceeding inbound arrivals at an annual rate of around two million, the last thing the country’s tourism industry wanted was another levy. But that’s exactly what visitors down under can expect to face if a planned increase to some of Australia’s tourist visas goes ahead.

Most at risk from a proposed rise in visa prices is the global youth market, with backpackers and other young travellers facing the prospect of a AU$70 increase to the Working Holiday Visa (WHV), announced during Australian Treasurer Wayne Swan’s mid-year budget review.

Australian Tourism Export Council (ATEC) managing director Felicia Mariani says the potential 25 percent increase in WHV fees would have a “critical impact” on the nation’s appeal within the “lucrative” but highly price-sensitive youth market.

“Australia is already way ahead of most of our competitor countries on fees associated to travelling here, with the WHV fees amongst the highest of most western countries,” Ms Mariani said, pointing to the near doubling of the WHV since 2005, from $180 to $350.

With a 17 percent increase in the Passenger Movement Charge confirmed in the recent Federal Budget, and with current laws requiring WHV applicants to have AU$5,000 in savings as well as a return ticket home, rival destinations such as New Zealand and Canada suddenly seem more desirable.

“Adding another tax increase to this fragile part of our industry will put us off the map for many young travellers,” the ATEC boss lamented.  

With weak global economic conditions and an Aussie dollar still soaring, Tourism & Transport Forum (TTF) chief executive John Lee said authorities should be looking at improving the country’s competitiveness by removing barriers to visiting the country.

“Instead, although Australia is already a high-cost destination, the cost of coming here just keeps going up,” he said.