Slug for tourism in dumb tax on vis­i­tors

Port Douglas & Mossman Gazette - - NEWS - Shane Ni­chols

A Port Dou­glas back­packer hos­tel op­er­a­tor has blasted the loom­ing in­come tax on back­packer earn­ings, which is due to kick off on July 1.

The fed­eral gov­ern­ment has mooted the tax, at a rate of 32.5c in the dol­lar, to re­place a regime in which back­pack­ers typ­i­cally pay tax on their earn­ings cur­rently and then get it all back when they fin­ish em­ploy­ment, along with their su­per con­tri­bu­tions.

Tom Quealy, owner of Coral Beach Lodge, la­belled the com­ing tax as a clumsy, short­sighted move that will hurt lo­cal busi­nesses by turn­ing away back­pack­ers who the hos­pi­tal­ity in­dus­try de­pends on.

“In this area dur­ing sea­son, the bars clubs, cafes, where these guys might work 50 hours a week be­cause no Aus­tralian wants the job – they fill up all the gaps and now they’re go­ing to pay all this tax,” Mr Quealy said.

“On these wages, no res­i­dent Aus­tralian tax­payer would nor­mally have to pay tax but these guys are go­ing to pay around $3-4,000 tax all of a sud­den. It’s go­ing from zero to max­i­mum overnight.

“That means these vis­i­tors will think about go­ing to New Zealand or some­where else in­stead of here,” Mr Quealy said.

“Aus­tralia com­petes very heav­ily with New Zealand for back­pack­ers. They have a flat tax of about 15 per cent in place.

“It’s go­ing to hurt up here es­pe­cially.

“You would’ve seen last year – ev­ery shop had a sign up say­ing ‘staff wanted’.

“The other prob­lem is that peo­ple busi­nesses like cafes are go­ing to come un­der pres­sure to pay peo­ple cash.”

The new tax was not men­tioned in Tues­day night’s bud­get de­liv­ery, dash­ing hopes by its crit­ics that the con­tro­ver­sial money raiser would be ruled out.

In re­cent months the tourism and agri­cul­tural lob­bies have been stri­dent in their at­tacks on the new tax.

It was a key dis­cus­sion point at a con­fer­ence of hos­tel op­er­a­tors in Cairns yes­ter­day.

Pic­ture: SHANE NI­CHOLS

Tom Quealy, owner of the Coral Beach Lodge in Port Dou­glas

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