Budget screws backpackers yet again, tax free threshold is axed

May 12th, 2015 | | industry

Tax GrabLast night the Federal Government removed the tax free threshold from all working holiday makers, effective July 2016.  They will now all pay 32.5% in income tax from the first dollar earned.  The government has also increased the working holiday visa fee from $420 to $440.

So backpackers can work and pay but no longer play!

Julian Ledger, CEO of YHA Ltd said “the government claims the change is forecast to raise $540million over four years or $135million per annum. The basis of this forecast needs to be investigated”.

Federal Treasurer Joe Hockey said “we don’t want to increase taxes on Australians, but we do want everyone to pay their fair share along the way”.  He might as well have said we will increase taxes for those who don’t have a vote.

The $540million in additional revenue is flawed, as its based on a similar or greater number of WHM coming to Australia in following years.  Who said they will still come?  In the past 12 months we have already seen a drop away in WHV applications, seen by some as a result of previous Visa Fee hikes. And fewer backpackers = fewer visa fees, fewer taxes and most importantly less spending on tourism product around the country and so fewer GST receipts.

ATEC Managing Director Peter Shelley added earlier today “Also of concern is the impact of changes to working holiday maker visa fees and the removal of the tax-free threshold that will affect around 200,000 youth travellers who visit Australia each year and spend an average of $13,000 during their stay.”  Small business income, tax revenue and productivity comes in any different forms and we all know from the ABS Tourism Satellite Account that tourism dollars flow on throughout the wider economy in many different ways.  Tax too early and the visitor economy suffers.

Treating visitors differently and taxing them from the first dollar they earn will leave a bad taste and less money in their pocket to travel around and see Australia. Visitors may not vote in elections but they can vote with their feet and have many choices of destination.

Backpackers themselves will be quick to post about this issue too, Wendy Aylward, Managing Director of AIFS said “our Facebook travellers group had its first post last night from a traveller voicing concern about the changes to tax free threshold”. Wendi added “and I expect to see comments throughout the day. Word will travel and those who factor tax returns into their travel planning may choose to head elsewhere.”

And negative publicity in overseas media:

Irish Times

Daily Mail UK

The Guardian

Yahoo UK

The current incentives for working holiday makers to stay in one place to meet the six month test rather than travel around Australia is removed.  To undertake three months rural work to qualify for their second visa is also reduced.

The threat remains, youth tourism earns billions for the Australian economy.  Young tourists carry out important work in rural areas, that young Australians don’t want to do.  The WHV is a cultural exchange between people of nations.  It is not intended as an earner for a government on a tight budget.

So what do readers think of Budget 2015? Have your say

Written by Chris Harrison

53 Responses

  1. Sky says:

    Hi Chris – thanks for the article. I noticed is that you mentioned “To undertake six months rural work to qualify for their second visa is also reduced”. It’s actually 3 months regional work and that has stayed the same.

  2. Tom O'Brien says:

    Terrible idea to axe the tax free threshold, especially while increasing visa fees at the same time. This will impact the whole backpacker tourism sector and beyond. Backpackers will have less spare money, which will inevitably lead to less people booking tours and wanting to spend less on hostels.

    The ripple effect will be massive. Tour operators, hostels and taxback companies will probably be the most affected, but this change will have a huge effect all over.

    Backpackers are already among the most exploited workers in the marketplace. I doubt there’s a single person that works with backpackers that hasn’t heard stories about exploitation and terrible working conditions.

    Let’s be honest, it’s pretty tough for backpackers to get jobs apart from in hospitality, sales, construction or on farms. 417 visa holders are already discriminated against by a lot of employers due to the 6 month restriction.

    I predict we’ll see less incoming visitors and a big downturn in average spend per visitor.

    • NoSlaveEverAgain says:

      I have very little sympathy for hostels though. They are mostly sharks. Hey, in Bali you can get a nice hotel room for $15/night. Even less. And you have lots more freedom in Bali (EXCEPT DRUGS). It cost me 16 dollars last year, for a huge room with TWO queen beds, INCLUDING a personal scooter to use.

      Yes, apart from drugs you have much more freedom in Bali. Much better food, Cheap everything and you don’t have to deal with the brainwashed, unworldly gumbies who assume that Australia is the “greatest country in the world”…

    • Joshua says:

      I work with many backpackers and the working conditions are fine. The backpacker tax is finally going to help cut down on the number of backpackers acting as cheap labour for local jobs. Not that the locals get paid much more, which they don’t. If you haven’t worked on a farm you can’t really see the benefit.

  3. zita says:

    Typical liberal politics. Small provincial mindset, penalising those that cannot have a say. Remember JOE HOCKEY, people have the choice to visit a vast number of countries just as great as ours so don’t think they will just keep coming. I remember that I intended to visit Russia on two occasions but the Russian government made it too expensive and too complicated so I didn’t bother. The Russian people missed out on about $5000 both times. We need these people to visit our country to make it a better place. We are so far removed from the rest of the world we should be happy that people even consider coming here. Believe me, we need them more than they need us! Joe Hockey is a typical backward thinking, private school boy from Sydney Uni. His wife is a banker and they don’t give a s…t about anything but their own little right wing pretend world in the backwaters of Asia. A reason in itself not to travel here!!!! Wake up you peasants!!!

    • NoSlaveEverAgain says:

      More will work illegally for cash, getting no protection from the government, no worker’s injurance, getting ripped off by shady employers (there are MANY HERE!!!)

      That’s what the government wants. A ruling class and the rest shall be slaves.

      Time for a full scale people’s revolution. It should have happened decades ago, I was always ready for it, but most weren’t. The majority of blind sheeple will wait until the last moment – until they nearly starve to death – before they finally stand up for the long overdue and necessary revolution.

      • Joshua says:

        Why should they not pay tax if they take our jobs. Time and time again I hear “locals don’t want to do these jobs, we need the backpackers”. That’s a load of bullshit. Locals want the jobs but cannot get them because backpackers are given first pick.

        The employers argue that because they can pay the backpackers less it helps them grow as a company. More bullshit. Locals don’t get paid a single cent more than an inexperienced backpacker who doesn’t know how a drill works.

        Keep your peoples revolution. The struggling minimum wage workers of Wide Bay don’t care for it.

        • Ben says:

          If many Australians wanted to do the rural work then you would see more of them applying for the jobs. If you argue that they don’t get a cent more than the backpackers but still don’t end up with a farm job, doesn’t that say something about the employer? Sounds to me like they’re more willing to give the job to the backpacker than the Aussie that’s demanding more pay! The fact that you assume that every backpacker is unable to operate machinery signifies how narrow-minded that view is. We come from all walks of life and many different backgrounds. Some are far more qualified than the employer we’re actually working for. We fairly contribute to the country and love being able to tour around, visiting all the beauty Australia has to offer, but do you think that people will be so inclined to when you have to work the whole time just to survive?? The money we earn generally goes back into the Australian economy anyway so builds your country’s economic growth and billions of dollars in tourism each year. Why tamper with those figures?

          • jason says:

            Mate your narrow minded. The Australians that get left out are the hard working ones who relocate for work. I walked into a business and got told straight out we don’t hire locals they are lazy just from my accent. I proceeded to say I relocated no difference. Yes there are a lot of lazy locals though the ones willing to relocate can’t get in because of this propaganda.

  4. Greg says:

    Very damaging publicity for our sector in key markets. I can’t see the Nats MPs taking kindly to it, as farmers will not be happy with anything that effects the numbers of seasonal workers – after all that was the whole reason behind the 88 days of rural work requirement to get the 2nd year visa.

    As Julian said – there’s no way this will raise $540m because the number of backpackers working (legally) in Australia will decrease.

    Instead you’ll see more doing cash in hand jobs (without the protection of fair work, workers comp etc), less bothering to get a 2nd year visa and more of them choosing to leave Australia at the end of year 1 to spend their cash in Thailand and Bali instead.

  5. NoSlaveEverAgain says:

    I used to be a backpacker. Now I live here. I know how hard it is to earn $600 gross per week picking fruit. It’s not work, it’s slavery. With the new tax that will leave you with $400/week. Then, if your job is organized through a worker’s hostel, they charge you another $200/week for a bed in a stinky room with many people.

    From the little pocket money left, you pay loads more taxes. GST, fuel tax, alcohol/tobacco tax etc. You end up paying 50-80% tax going to the government (and from there going to the billionaire bankers).

    This is TYRANNY STATE AUSTRALIA. for you.

  6. deb turner says:

    we have already lost thousands to Canada goodbye tourism in oz

  7. Thommo says:

    I can (sort of) accept a $20 increase in the Visa fee. In a incredibly bad year for our inflation this could almost represent our annual CPI. But maybe we need to set a clear Visa application rate going forward and set it at $6345 AUD. $440 Visa + $55 PMC + 32.5% of $18,000 threshold.

    Our Int’l visitors aren’t silly, and if they don’t understand the policital jargon, I think social media will let them know pretty quickly.

    I often scoff at our Senate, but I really hope they drag the chain on this one!

    • Chris Harrison says:

      Thanks Thommo, suggestions from Bill Shorten on morning radio in Sydney are that Labour will not support the whole budget. Question is will they support the drop of the threshold for this important visitor market?

  8. David says:

    The impact of penalising Backpackers through applying an automatic higher rate of tax will be felt throughout so many Australian industries, why do backpackers take the work that Aussies are not willing to take on?…Simply because they are willing to do the unusual hours and the jobs that we do not want to do!

    Changing Backpackers taxes to 32.5% from the first dollar does not bring them in line with Australian tax payers. An Australian resident for tax purposes enjoys a tax free threshold of $18.200 and then they pay 19% tax- not 32.5%. So be under no illusion around the change being made to create a “level playing field” – it is designed to penalise non-voting visitors.

    The government has estimated raising $220 million in additional taxes per year from the 2017 financial year, but they have failed to account for the inevitable drop in visitor numbers and the likely increase in cash in hand work. When visitor numbers drop and the supply of willing workers falls there will be so many economic losers ranging from Bars, Farms, labouring companies all the way through to tour operators and accommodation providers.

    These changes will come into effect unless we all write to our local federal member of parliament opposing the proposed changes. The government is targeting a non-voting group, we the voters need to show them how these changes will affect our business and therefore will affect our votes.

    Find your local MP here and lobby the s..t out of them here:

    • Joshua says:

      “why do backpackers take the work that Aussies are not willing to take on?…Simply because they are willing to do the unusual hours and the jobs that we do not want to do!”

      The middle class of Australia sicken me. You think we don’t want to work and that is laughable. I don’t get everything handed to me and I’m stuck in an area with the lowest employment rate in the WHOLE COUNTRY. Do you know why? It’s because the backpackers have taken the majority of jobs in our area’s largest industry, farming.

      Our backpackers just had their rooms fitted with foxtel. I can’t even afford rent for university. What a struggle.

      • SueJ says:

        You cannot TAKE a job it has to be given to you. How do backpackers take your jobs? Do they strong arm the employers into employing them? Of course not. Do they threaten, somehow force the jobs to be given to them? Don’t think so. If you think these people get everything handed to them just because their employer hooked up Foxtel you probably haven’t worked a day like they have. I can’t afford Foxtel either but I’m not complaining about it. Small compensation for hard work performed by people that now will be over taxed like no ‘Australian’ is.

        I agree with David, ” under no illusion around the change being made to create a “level playing field” – it is designed to penalise non-voting visitors.” The government, as usual, is looking for easy ways to make money off the small end of the income earning scale as it is far easier to do that than tackle the big business tax rate. The forecast of revenue is unrealistic as the effect will dissuade not provide incentive to come here to work. The government should go straight at the taxes leaving the country instead of faffing around with this stuff.

        • Jeff says:

          We do not TAKE local jobs. It took me just under 4 months to finish my 88 days. I worked on Saturdays at a farm that paid roughly $4 an hour on a piece rate agreement. I complained to the FWO who are meant to protect and help workers but all I got was them asking for signatures from my employers. Now, if you were a business and you willingly took part in the illegal practice of under paying your workers would you really go on record and sign a piece of paper signing your own fate? No. So I gave the name of my employer, the supervisors, the address and normal working hours, as well as documents showing how little I pay and pictures from the farm but got no help what so ever.

          so, I earnt roughly $30-$40 a day for 6 days a week, that makes me $240 a week. I was paying $220 in rent every week which left me $20 to do washing and buy food. Oh, but wait, I wouldn’t be left with $20, because a large chunk of my salary (32.5%) went to the government in taxes. So in fact, I was pulling money across from the UK (where I had earned it and already paid tax on) to pay my rent and the enormous tax rate this government imposes.

          But I guess it must be ok for some backpackers as their hostel had Foxtel…

  9. Chris Harrison says:

    There is already plenty being written about this in the international press, none of it very good for our sector and hopefully the Press Officers in government and opposition are reading much of it. Here are just some examples from UK and Ireland. But every country we have a 417 or 462 relationship with will have similar, the fallout from this is already being felt:

    And take a note from our previous comment, write to your MP, email your MP, post: tweet: or tag your MP. Backpackers can’t vote in elections, but the backpacking industry can and does. Our sector is made up of 1000s of SMEs and 10,000s of voters and the wider tourism industry even more. Make your feelings known now, OR backpackers will vote – with their feet and go elsewhere.

  10. Graham Vickers says:

    According to the ATO website working holiday makers have always been non- residents for tax purposes. The tax free threshold is only for Australian residents. As an employer of working holiday visa holders we have been deducting the non resident rate of tax for years as this was the available information from the ATO. Have we been over taxing them?
    Try the residency test on the ATO website and see what you find…clearly non resident and clearly stating there is no tax free threshold. Please explain????

    • Steve says:

      Very few backpackers resided in one location for more than 6 months, had the same job and lived like a local would and as such would not usually have met the resides tests to be an Australian resident for tax purposes and eligible to claim the tax free threshold. Unless they were going to work there permanently more than 6 months and settle, they should have been taxed as non- residents and you probably taxed them correctly in most cases. The problem is many said they were residents (because it’s self assessment) and were taxed as residents at end of year on the tax return so then they get most, if not all of it back without really paying a cent of tax! The changes will remove this loophole but also means they get nothing tax free.

      I’ve worked in the ATO call centre and backpackers were always ringing up also thinking they don’t have to pay any tax so therefore think they were also able to just ‘get all their tax back’ instead of realizing only $18,200 may have been tax free and some tax may liable if earning more.

      They aren’t locals on that type of visa so while they claim they will have less money to now spend in Australia and survive to pay rent, welcome to the club that’s the same for everyone it doesn’t justify the law not being applied appropriately. I think the changes are fair because there were far too many not entitled to tax free threshold who claimed it.

  11. 4travellers says:

    A further reason to make persons consider other travel destinations over Australia. With many WHM coming from recession hit countries, combined with the high cost of living and travelling in Oz and now that they will loose 32.5% of all the monies they do earn why would they consider a WHV?

    Money they bring in = spend in the local businesses = then those businesses pay increased corporation tax, employ more staff who pay income tax and so the flow of income goes on.

    Is tax really lost is we offer them the same privileges as a tax resident? Those that earn under the tax free threshold and get a tax refund typically spend it all on trips/ travelling in and around Australia and in local businesses whom all pay taxes to the government and employ staff. Those that earn over the threshold pay their fair share of tax but are also higher earners so spend more locally on accommodation, travel to work etc.

    The circular flow of income and money around the economy needs to be maintained. If we put these people off from coming in the first place then the extra cash that they bring from overseas never reaches our economy or businesses. Overall, surely it is better to attract backpackers, their overseas money and then tax them at a fair rate so that our businesses thrive, the local economy thrives and the government ultimately make more in corporation tax.

  12. John George says:

    The tax on $21.08 casual hourly horticultural rate will be bad enough, leaving around $14 after tax, but the tax on contract piecework rates will be punitive. For most backpackers picking oranges who at best pick around 3 bins a day at $25-28 per bin before tax they will be walking away with $50 for 8 hours. And that is the ones who pick 3.
    Beans, peas, grapes, pruning vines, pulling out, other vegetables and fruit paid at piecework rates will produce the same results and probably worse. We all know backpackers do this work because of the lure of the second year, but with this tax rate they will not have enough money to afford a second year.
    So cash in hand becomes popular, backpackers will stay in the city where they have more chance of hourly paid work, and there will be a reduction in backpackers working as seasonal pickers in regional areas as they won’t be able to afford to do that work.
    Many will choose not to come to Australia in the first place, those that do come will forgo their second year in Australia, and regional areas will find it harder to get horticultural workers.
    A policy dreamt up by a short sighted government for a small return based on dodgy projections.

    • Joshua says:

      Regional areas won’t suffer because locals don’t get paid more than backpackers, we are all on minimum wage. Saying that locals don’t want the work is a blatant misconception.

      If the majority of pickers are picking 3 bins a day then the bin price should not be $25. If it is then the pickers should be able to pick 10 bins a day.

      I would kill for an 8 hour work day.

      • Jeff says:

        But farms don’t increase the rate. You obviously haven’t worked much otherwise you would realise this, or you are given the brand new plants with first pick on everything in order to make minimum.

        Locals are paid less that a backpacker so surely the incentive for a business is to employ a local. Their costs (as labour is the largest cost in any business) will decrease if they employ locals and therefore profit increase (and more tax paid on the profit).

        If you consider all the above, why do you think farms prefer to spend $4-$5 more per hour on backpackers?

  13. Joanna says:

    I am not in favour of charging backpackers anymore for anything – but, really, nothing has changed yet. The 32.5% tax rate has been in operation for a few years now and backpackers have always been charged tax from the first dollar BUT able to claim it back by the services of the tax back companies.

    The thing I have complained about for years is the inequity of city workers being able to live in one place for more than six months take several different jobs – and being able to claim tax back by virtue of residency. Those who work in the bush, doing what the Government asks in the way of fruit and vegetable picking, do not have this residence luxury. Here at Visitoz we advise all our people, who come to us straight from their home countries, to stay six months in their first job, ask to stay on without working an extra couple of days – and claim residency. These people will have achieved two things – their second visa qualification and their residency. However, the temptation is always to go rushing off to have a holiday after a few months without spending anything – the money has been burning a hole in their pockets for far too long. When they do leave their jobs after six months of working they can afford to have a really long holiday which then benefits all the tourism operators all around this country.

    Recently the Fair Work people came along to see us and seem to have taken some of our suggestions on board about the second visas – and we told them of the inequity of gardening in central Adelaide counting but not working on a cattle or sheep station which happen to be in the same post code as Wyong or Penrith.

    I hope they will now look at what they are doing and make some changes. I would suggest that they tax all second visa workers at 10% – because we want the fruit and veggies picked and the sheep shorn – and keep these 32.5% rules for those in the towns and cities – perhaps increasing to 2 years the level for residency – this would bring in a lot of cash to the government but would be very controversial! It would also encourage more backpackers to work outside the cities and in turn free up the jobs that the Unions claim that they take. Then we would see where the real youth unemployment is!

    I agree that we have huge competition from Canada, but they have quotas – but I believe that New Zealand has been taxing from the first dollar for everyone for some time now albeit at a much lower rate.

    My rallying cry to the youth at these expos has been our high hourly wage rates and the fact the US and Canadian dollars and pounds are all in a good position vis a vis our Aussie dollar.

  14. Macca says:

    It must be remembered that backpackers do not receive or ask for many of the benefits that our taxes are collected for such medical and hospital cover.
    In scapping the 2nd year for volunteer work I do not believe that Assistant Minister Cash took into consideration those backpackers that volunteer for organizations in cleaning after bushfires, cyclones and land care projects

  15. Greg Cole says:

    I just did the residency test on the ATO website. I answered the questions as a BP might answer them. Seems they easily qualify as residents for tax purposes. So I think that means they can easily say they’re residents?

    • Chris Harrison says:

      hi Greg, thanks for commenting and also checking the ATO site. Nothing actually changes online until the Bill is passed through parliament, which I keep reiterating as now is the opportunity to stop it. Once passed we are done. Also, nothing changes until 1 July 2016 when the legislation is implemented, however by then the damage will be done. The change is that no WHM on a 417 or 462 will qualify for the tax free threshold, removing one incentive or reason to come here or work here.

  16. Wrote this to my Federal M.P (Ken O’Dowd) today.
    Hi Ken,
    Rang your office the other day and spoke about this issue with a really lovely lady who mans it while you are away in Canberra.

    The changes the Federal Government is making to the Working Holiday Visa for backpackers is just about the dumbest idea the government has come up with in a transparent money grabbing revenue raising effort targeted at people who cannot even vote and who do not get the benefits that we ordinary tax paying Australians get.

    This is incredibly short sighted!
    I do agree with them paying tax…on a level playing field the same as everyone else!
    Not 32.5% on the very first dollar they earn!
    That is just extortion!

    They already pay $420 just to lodge an application to work in Australia (That is being upped to $440).
    And some of them after paying this fee do not even work….so that is free money for the government already!

    Also to be considered is that, having made money working and supporting our rural farming industries, they then spend all that money on further tourist adventures in Australia with business’s who do pay tax and employ Australians.
    The flow on benefits are enormous.
    Very few actually transfer money out of the country as the exchange rate is so poor for them.

    With social media the word is getting out fast and backpackers will still come but stay for less time and spend less.
    Thanks for shooting our industry in the foot.

    It is quite a big thing in the media at the moment about Australian employers “ripping off” backpackers and now we are seeing the Federal Government jumping in to do the same thing, only you are doing it “legally”!

    Ken you need to advise your Federal colleagues to wake up to themselves

  17. John George says:

    Bruce, good letter, I am going to copy it and send it to my MP, and amend it slightly to send to the various cross bench Senators, many of whom live in rural areas. Maybe a couple will see some sense.

  18. Greg says:

    What’s the latest on this? Haven’t seen anything on it being passed. Perhaps new PM/ Treasurer will result in a rethink.

    • Chris Harrison says:

      Fingers and toes crossed Greg, new Treasurer has said that we don’t have a revenue problem, we have a spending problem. Well backpackers add revenue AND don’t cost anything. They also add to net migration (a proportion of 417s do look to migrate in the long run) which is integral to a healthy economy and is slowing. But no the Bill is still before the house, not heard a whistle. Just depends where it sits on the list of Bills to be read. The new Federal Tourism Minister (Senator Colbeck) is a Tasmanian, lets hope he sees the error of taxing a market that contributes to regional and remote economies.

  19. Steve Andrews says:

    Our governments be Liberal or Labor fail to see the potential of the tourist industry in this country. Potentially could be huge, but there is short vision from our politicians. Look at other countries like France 100 million visitors a year, NYC over 50 million + a year and many other examples.
    Will they ever learn???? doubt it.

  20. Chris Harrison says:

    All, I have been watching the Bills being passed and this one has been extended to 25 February 2016 (that doesn’t help those WHM trying to decide whether to extend their visa, look for work or find greener pastures, but that’s parliament). See for details, Chris.

  21. Chris Harrison says:

    Current comment from Canberra “There is no legislation drafted for the temporary worker issues. They expect they will consult on it before it is progresses, if it is going to progress.” They being the politicians, so still no decision has been taken.

    Getting ‘evidence’ of the likely downturn in WHV numbers and so less labour to work in rural and regional areas (thereby damaging their economy) is imperative. If you have not pushed out the survey, please do so now.

  22. Such a precious resource, we are all going to have to pay higher prices, as well as things like the backpackers tax due to come in later this year I do think people are going to have to expect higher prices for all consumables.

  23. Hi Ken, (Federal Member for Flynn, Gladstone, Qld)
    I really want to congratulate you and the rest of your compatriots in Canberra for the most incredible bit of stupidity I have ever seen the Liberals pull…of course I am talking about this 32.5% taxation on the first dollar that a backpacker earns in this country.
    Well done mate…..they are staying away in “droves”.
    I estimate that my numbers are down by 40% this year…you have single handedly crucified both the tourism industry and the agricultural industry who cannot survive without these seasonal workers.
    I have always thought the Liberals and National party to be the lesser of two evils in Canberra and elsewhere… Labour are so incompetent that they mostly get caught when they are corrupt….your lot are mostly better fiscal managers and cover their tracks better.
    Well this time you have really “screwed the pooch” and you are going to have a whole lot of us from at least two industries pointing the finger at you.
    What kind of idiots do you employ in Treasury who advised you that this one was going to work?
    Heads will roll over this one….best make sure it is not yours!
    Bruce Rhoades
    CEO and Chief Pilot “1770 Castaway”

  24. Chris Harrison says:

    Axe backpacker tax says the ACCI, The nation’s peak business lobby has urged the federal government to use the budget to streamline visa processes for key tourism markets, axe a so-called “backpacker tax” and extend freezes on passenger movement and visa charges.

    The ACCI’s submission suggests the government grant a second-year extension to working holidaymakers who spend at least three months working in regional tourism and hospitality businesses.

    It has also calls for reforms to the Tourist Refund Scheme to allow competition by private refund operators and recommends axing the “backpacker tax” by reinstating the tax-free threshold for working holiday visa holders.


    The big end of town is waking up to the error of this policy, keep lobbying, keep talking to your state and federal MP. We haven’t won yet, but our allies are mounting, Morrison is listening.

    • Macca says:

      What ever the out come is of the proposed “backpacker tax” along with the three States and Federal Governments Inquiries into Labour Hire Companies much damage has been done.

      The Government must consult the industry to repair and reinvent the WHM visa.

  25. Emma says:

    Does anybody know if you can still claim the higher rate of tax back when you leave the country? Or what happens if you become sponsored – do the same tax rules apply?

  26. Nigel says:

    I am a contractor in Tasmania,
    I work in the fruit vegetable and wine industry.
    I employ almost solely working holiday makers, not because I want to but because there is not enough Australians willing to do the work.
    There is absolutely no doubt in my mind that as soon as I start to deduct the new rate of tax from my employees pay packets they will leave and they will stop coming.
    This will put me out of business I am sure but I am also sure that it will cause many horticultural enterprises to stop growing any kind of crop which involves manual labour,
    Our vegetable and fruit production will go and so will our top end wine production.
    It will cause many backpacker hostels to close and have a massive impact on tourism and hospitality.
    I have voted Liberal all my life but if this tax is imposed I will be voting Labour and closing my business obviously.

  27. 7ooo says:

    Most farmers are cowards, submitting to the government like fearful sheep. Every time I’ve asked them to employ me cash in hand, they declined.

  28. Steve says:

    This tax change will have a dramatic effect on the fruit industry and others. The major points being,
    – The timing is poor as it is in the middle of most harvesting seasons
    – The proposed tax change is a substantial monetary nett decrease for workers.
    – The change will effect tourism as backpackers spend a percentage of their earnings in Australia.
    – There are plenty of options allowing backpackers to desert Australia for New Zealand and other countries with less tax imposed.
    – Reduced back packers means less fruit in the market that will translate to higher cost to the consumer and less export opportunities.
    – Despite the change not being finalised backpacker applications are down on last year mainly on the probability that the increased tax will proceed
    – The business and tourism flow on effects will be huge.

  29. Ian Williams says:

    Since many backpackers either work for contractors and only get paid $12 an hour and the tax the contractor takes out, is often not passed to the taxation office “or”
    The farmer just pays the worker much less than the award wage,

    Of Course Barnaby is happy as are the farmers, but so far, all sides of politic’s are terrified of dealing with the dirty business of Contractors, illegal workers, and well under award wages, and the amount of tax not being paid to the government by dodgy contractors, “too hard for Barnaby Joyce to deal with”, the easy option – Tax the Backpackers – and the dodgy contractors will be jumping for joy,

  30. Viv says:

    Federal Treasurer Joe Hockey said “we don’t want to increase taxes on Australians, but we do want everyone to pay their fair share along the way”.

    Why does Joe Hockey think backpackers should pay higher taxes than the long term residents – they aren’t eligible for free education or healthcare, or Centrelink benefits? What is even fair about them paying at the same rate as those who do get all those benefits? Obviously they should contribute to pay for policing, roads, government generally etc etc but they certainly shouldn’t be paying more than the locals.

  31. Pete says:

    Here in au to see our backpacking daughter, so due to her here working towards her 88 days au has benefited from three extra visitors staying for a holiday of lifetime lasting 26 days. Expected spend $ 16,000. Wonder if that spend will be continued by other families after the tax grab?

  32. Kristen says:

    Backpackers who come to Australia on the working holiday visa-

    – Can earn and save a lot compared to other countries.
    – Take Australian jobs, especially in hospitality. These are jobs Aussie’s would and can do, if it wasn’t for every tom, dick and harry employer hiring backpackers and paying them a pittance for it.
    – All this talk about a cultural exchange lol First of all, Australia has no culture (except for maybe bogans) and the just-left-home backpacker doesn’t really offer any culture either. If you call an attempt at playing a guitar and drinking goon and pissing the bunk bed – cultural, well then, you should go to a developing country and go experience some real difference.
    – And that’s what backpackers do. Save loads, work heaps, and then they take all the AU $$$ overseas to spend on… drinks, drugs and full moon parties.

    So shut up and stop complaining about the tax.. If you don’t like it – stay in your own depressing hole that you live in where you may be lucky at earning $10/hour.

    • syl says:

      yep soo true,that is exactly what they do and employers like them but they dont,its called disposable labourer. So you get this redneck paddock bosses, and [and I talking about harvesting jobs] three quarter of them scumbag, drug dealers high up on power of hiring and firing and they treat them like shit because they came in droves, and fire 5 today there many more tomorrow to choose, at the end of the day they think they done the job for the farmer, another well informed on the dirt of his enterprise.

      By the way for people that think the backpackers is hard worker and the locals australian cant do this job, I suggest you go and get your facts right, because I seen them few moths ago in tomatoes paddock in Shepparton where they dont last more then 2 hours, because its tough out there, you out to be a gun to make money, because no inflation on piece work, the price of piece work is been the same for the last 20 years. Now do you want me to tell you who where picking tomatoes in Shepparton paddocks, certainly not backpackers simply because they cant, its too hard, too hot, but hips of Islander, Papua New Guinea, etc and there also the Islander scheme put in place for the agricultural indistries horticulture, and they work hard, they know is a job with condition and you ll have to push your body to extreme like an athlete to make money as I said before no price of piece rate changed in 20 years. And who were to get the crops off back ten years ago, certainly no them or did you all forgot that you all still ate fresh fruit and vegetables then? oh ye was the druggos and the dole people back then lol. I’m speaking from personal experience, after spending 30 years picking fruit I cant get a job in my town where I invested in property pay rates but can’t work.

  33. how The $540million in additional revenue is flawed?

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