A tourism expert says a new visitor tax could be selling New Zealand short and could see businesses lose out. 

Tourists will be hit by an extra charge to enter the country after Cabinet approved a $35 per visitor levy.

The levy is expected to raise an estimated $80 million a year which will be put towards infrastructure and conservation projects, Tourism Minister Kelvin Davis says.

Tourism Industry Aotearoa chief executive, Chris Roberts, told Mike Hosking the tax could have been more.

"We have exempted Australians and Pacific Islanders and some other so only 60 per cent of the international visitors will be paying the tourists tax [so] it collects less than it could have otherwise."

However, he said the tax could see the country lose out on $50 million, with visitor numbers expected to drop by up to 15,000 by 2021.

"The calculation by MBIE is that 15,000 people, who would have come to New Zealand, won't."

Roberts said the Government is still making $80 million a year to spend on conservation, it's businesses that will lose out

"The loss of spend is the spend of the visitor who is now not coming, which would be spread around businesses around the country."

Conservation Minister Eugenie Sage said public consultation showed the levy had strong support, adding that 107 submitters were in favour of setting the fee at $35.

"The money raised through the levy will help improve the protection and enhancement of New Zealand's distinctive natural environment and improve tourism planning," she said.

National's Tourism spokesman Todd McClay sa