Gold Coast Central Chamber of Commerce President Martin Hall said the plan, while well-intentioned, was short-sighted and potentially could actually hurt many businesses.
Mr McCormack has suggested using empty Gold Coast hotel rooms for quarantine as part of a plan to bring home thousands of Australians trapped overseas.
But Mr Hall says while the plan would benefit some hotels in the short run, it could have unpleasant side effects for other businesses.
"The biggest issue is that none of the 'isolated guests' will be spending any discretionary money in our businesses. The hotels will be full but the other businesses in the area will be suffering.
"Rather than focusing on a plan for a quarantine zone, we should instead be focusing on plans to bring more and more Queenslanders to the Coast for a well-deserved holiday."
Mr Hall said he was hopeful the State Government would further ease restrictions soon.
"The rate of community transmission for COVID-19 had dropped to zero or almost zero so the Queensland Government should be looking at loosening restrictions again soon.
"What we need is the ability to trade and survive not have our businesses suffer at what now seems a politically motivated dragging of the feet."
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