Ballarat tourism leaders unclear how city will be impacted by new 'short stay levy'

The "short stay levy" will be 7.5 per cent of an accommodation platform's revenue and will be introduced from 2025.

Midwest Tourism chair John Pandazopoulos said it would be important to keep different accommodation options available for tourists in the region.

"People that are looking to rent a whole house are generally different types of customers," he said.

"They want three or four bedrooms, but they're not going to go and rent three motel rooms."

Mr Pandazopoulos said different groups of people travel in different ways.

During his time as tourism minister in the early 2000s he said he would see multicultural families wanting to travel together in bigger groups.

"People wanted to rent an Aussie house and have an Aussie experience with a barbecue on the deck," he said.

"It's important not to lose that."

The money raised from the levy will be given to Homes Victoria.

In its new housing statement the state government said the levy would be to offset how many homes are used for short term accommodation rather than long term rentals.

"It makes sense that they should provide some benefit toward the places that can," the statement said.

Mr Pandazopoulos said it was unusual for the levy funds to be put into more housing rather than the tourism industry.

"I just got back from Europe and had to pay hotel levies in Portugal and Greece," he said.

"If you go to America, you are paying a local, state and national hotel tax."

"It's not uncommon to have them, but they go back to support tourism."

Mr Pandazopoulos said continuous investment keeps the industry growing.

"We've always been tourism poor in resources needed to chase customers and visitors," he said.

"If we add more, we'll get more and we would be producing greater economic value."

Mr Pandazopoulos said he was supportive of more social housing.

"But it's extremely unusual that it comes from parts of the tourism industry to go and fund that," he said.

He said there was potential to "lose a fair share of tourism by having a good intention".

But ultimately "the consumer will still pay".

"The thing is, how many people get discouraged from making their place available?," Mr Pandazopoulos said.

The new levy will also override other rules put in place by local governments.

Accommodation leaders including Sovereign Park Motor Inn owner Tim Canny and former Mercure managing director Iain Gunn have been calling for more regulations since 2018.

At the time they were frustrated property owners could make a considerable amount of money off their short term rental while not complying with the same quality standards or paying commercial rates.

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