The Accommodation Association of Australia (AAA) says it would oppose any move to impose a bed tax in popular tourist destinations. Byron Shire Mayor Simon Richardson flagged the idea of the tax, which he said was popular with many ratepayers. Cr Richardson said this was hardly surprising in an area attracting more than 1.5 million visitors per year.

He has called for other councils affected by big tourist numbers to back a renewed push for the levy to fund infrastructure. "I think a bed tax is a no-brainer," Cr Richardson said. "It's happened all around the world [and] it never made the tourism industry fall. "It's something that most visitors fully expect to pay and have the capacity to pay."

But AAA's chief executive Richard Munro described the idea as a risky move."You can't just raise taxes every time and expect people to pay them," he said.

"We're in competitive destinations [and] Byron Bay is a great location but it's not unique and people have a choice. "If you start putting levies on the consumers, you're going to find that people are going to start looking around; people are price-sensitive.

The butcher, the baker, the candlestick maker ... everyone's benefiting from tourism; it's not just the hotels and motels and serviced apartments — everyone benefits.

"It drives the economy, it drives jobs [and] you risk cooking the golden goose, almost. "If you start putting these levies on you'll find that people just won't go." The criticism came as no surprise Cr Richardson who said the tourism lobby was "pretty strong". "There's always a fear that you put in a tax, you're going to scare off visitors," he said. "I brought it up at a local government tourism conference only about six months ago, and the main powers-that-be were very quick to try to suggest that it was a flawed, ill-conceived idea. "Of course it's not; most of the world does it."

This article was originally sourced from ABC News and written by Bruce MacKenzie.