12 May 2016

Backpacker tax will cripple agriculture workforce

12-May-2016

If the Federal Government chooses to introduce a tax of 32.5% on every working dollar a holidaying backpacker earns, they can kiss goodbye to growers voting for them in this year’s election, according to Citrus Australia Chair, Tania Chapman.
“Our industry relies on holidaying backpackers who enjoy a working holiday in Australia where they assist with the harvest of a wide range of horticulture crops,” Tania said.
“In recent times, about 20% of all who are on a 417 and 462 working holiday Visa have also been in Australia on a second year Visa, meaning they have completed 88 days of specified work in rural Australia.”
“Backpackers contribute more than $3.5 billion to the economy each year and around 40,000 find employment on Australian farms. We need more of them, not less.”
Tania said the citrus industry eagerly await the results of the Government’s interdepartmental review process which was overseen by Tourism Minister Richard Colbeck, Assistant Agriculture and Water Resources Minister, Anne Ruston and Keith Pitt, the Assistant Minister to senior minister Barnaby Joyce.
“We understand that lengthy discussions with industry groups in particular the rural sector occurred,” she said.
“We also are aware that the Ministers have heard about the strong contribution holiday backpackers make to Australia’s rural workforce, and how they want to maintain that workforce’s capacity.”
A proposal from the review is expected to be considered by the Federal Government who will “make an announcement in due course”.
Tania said the ‘due course’ could be too late.
She also expressed concern about the resistance the Federal Treasurer, Scott Morrison, was having in terms of changing the 32.5 per cent tax on working holidaymakers.
Tania said Voice of Horticulture, which represents all horticultural industries, including citrus, had lobbied for a tax rate between 17-19 per cent to put us on the same page as Canada and New Zealand.
“These two countries are the alternatives for our backpacker workforce and given that backpackers make on average $15,000 during their stay in Australia, a tax rate of 32.5% is a huge deterrent.”