The Wanaka Community Board this week decided to forgo the new policy of charging 7.5% of turnover when it considered an application for a commercial land use licence from the Lucky Montana Flying Circus paragliding business.
After hearing a plea by the business operator not to ruin the venture with a new "tax", board members recommended a licence fee of $5 per customer, with the goal of encouraging sustainable business.
The paragliding business has operated on Pembroke Park and Roys Bay beach since 1997, and was renewing its licence.
Previously, the Queenstown Lakes District council had charged a flat fee of $1250 plus GST, with an additional $5 per person for every flight exceeding 250 flights.
A new policy adopted in June removes the flat fee and states commercial operators seeking a licence to use council land should pay "7.5% of gross revenue or a per head fee, as appropriate to activity".
Lucky Montana Flying Circus business operator Rob Darby said in a submission to the board the percentage fee would double his existing fee. He called for the council to support and nurture businesses rather than tax them.
Charging 7.5% of turnover would force him to increase his $190 tandem flight fee to over $200.
"The price point for our product is very sensitive. I have tried hard for many years to keep the price well below $200," Mr Darby said.
He was concerned the turnover-based rate would see him pay a fee of $14.25 per flight, when other concessionaires, such as kayak hire companies, would pay $3 per kayak hire.
Although his product was more expensive than a $40 kayak hire, that did not necessarily relate to higher profit margins, he said.
He had five staff, high maintenance costs, cleaned up the beach and park and provided his own infrastructure.
"I question the viability of any of the beach concessions. Other concession holders may accept 7.5% but the reality is that their businesses are unlikely to support this, or any other overhead, if their businesses were assessed correctly. Essentially, all of the concession holders are trying to maintain a lifestyle and have bought themselves a labour of love. What we do not want to see is businesses becoming unsustainable," Mr Darby said.
Deputy mayor John S. Wilson, who retires this weekend, reminded the board other applicants would seek consistent treatment.
Lakes Property Services property manager Dan Egerton said a $5 fee would be less than 2.5% of turnover and could cause problems in defending the 7.5% fee paid by licence holders at Bob's Peak, in Queenstown.
Wanaka Community Board chairman Lyal Cocks said every application should be treated on its merits. He preferred $5 per head. Other board members agreed.
• The board noted a potential conflict of interest before debating the item. Mr Darby is employed by the council as a Wanaka-based project manager.
