Back­packer back-up plans hit with taxes

The Myanmar Times - - The Pulse -

BEEN think­ing of dash­ing Down Un­der to make a quick buck? Not so fast – for­eign­ers in Aus­tralia on work­ing hol­i­days face pay­ing a 15 per­cent levy on ev­ery dol­lar they earn af­ter the govern­ment com­pro­mised on a con­tro­ver­sial “back­packer tax” yes­ter­day, dump­ing plans for a higher rate.

Can­berra had ini­tially sought a rev­enue-rais­ing 32.5pc tax for sea­sonal work­ers from Jan­uary 1 un­der a pro­posal first flagged in the 2015 bud­get, but the move was met with an outcry from farm­ers and tourism op­er­a­tors.

They feared it would de­ter tourists from choos­ing the coun­try as a des­ti­na­tion, with some 600,000 back­pack­ers head­ing to Aus­tralia ev­ery year, many find­ing work pick­ing fruit.

Cur­rently, like other work­ers, back­pack­ers do not start pay­ing tax un­til their an­nual in­come ex­ceeds A$18,200 (US$13,500).

Farm­ers com­plained bit­terly that the levy could af­fect labour sup­ply at har­vest time and the govern­ment in Septem­ber wa­tered down its plans to 19pc.

That led to a po­lit­i­cal stale­mate with the La­bor op­po­si­tion, the Greens and in­de­pen­dent cross­bench se­na­tors de­mand­ing 10.5pc, in line with New Zealand.

But Trea­surer Scott Mor­ri­son said a com­pro­mise had now been reached with key cross­benchers who hold the bal­ance of power in the up­per house Se­nate with leg­is­la­tion set to be in­tro­duced on Mon­day.

“To­day the govern­ment will be work­ing to put in place a bill which will pro­pose 15pc on the back­pack­ers’ ar­range­ment,” he told re­porters, voic­ing con­fi­dence the govern­ment now had the num­bers to steer it through par­lia­ment this week.

Farm­ers were grate­ful the is­sue looked set to be re­solved.

“It has been a painful process but we whole­heart­edly wel­come the an­nounce­ment that a com­pro­mise rate of 15pc has been reached,” said Na­tional Farm­ers Fed­er­a­tion chief ex­ec­u­tive Tony Ma­har.

“We now ask that the Se­nate ex­pe­dite pas­sage of the rel­e­vant leg­is­la­tion to pro­vide the long needed cer­tainty to the sec­tor and al­low busi­nesses to start re­build­ing back­packer in­ter­est in on-farm jobs.”

La­bor’s agri­cul­ture spokesper­son Joel Fitzgib­bon ar­gued that 15pc was still too high.

“All back­pack­ers do is look at the head­line rate,” he said. “They look at New Zealand at 10.5[pc] and Aus­tralia at 19 or 15 and they de­cide to go to New Zealand.” –

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