The Federal Government’s proposed ‘backpacker tax’ is already hurting our regional communities reliant on labour from the Working Holiday Maker program. Queensland agriculture industries such as cotton and horticulture are already feeling the effects of a reduction in international workers with many industries relying upon backpacker labour to satisfy demand during peak harvesting periods.
The Federal Government decision to scrap the tax-free threshold for backpackers working in Australia will only further undercut local economies. Although QFF and its members understand that the government is trying address Australia’s fiscal difficulties, the damage to communities and industry will far outweigh any budgetary gains the government can expect. It is with this in mind that we ask the government to reconsider and properly understand the full implications of this change to backpacker taxation.
The Working Holiday Maker program, which includes the Working Holiday (subclass 417) visa and Work and Holiday (subclass 462) visa, allows visa holders to stay in Australia for 12 months and work for up to six months with any one employer.
The program was structured to allow holders of the 417 visa to receive a second one-year visa if they work for 88 days in regional areas, with the overwhelming majority of these extensions coming from work in agriculture, forestry and fishing.
Figures from the Department of Immigration and Border Protection show that the number of workers coming to Australia under the 417 visa has dropped repeatedly over the past two years, with over 34,000 fewer visas being granted in 2014-15 than in 2012-13. This includes a nearly 60 per cent decline in workers from Ireland and a 26 per cent decline in workers from Taiwan and South Korea.
Agri Labour Australia’s recent survey of backpacker workers confirmed the direct correlation between the current and potential visa applicants change of mind in considering a working holiday to Australia or /extending their visa. More than 50% of the respondents to the survey have decided to return home after July 1 as a result of the increase in tax condition.
Queensland agriculture industries such as cotton and horticulture are already feeling the effects of this reduction in international workers. These industries and communities rely upon backpacker labour to satisfy demand during peak harvesting periods. Without labour to get the crop in and out of the ground farmers will be under serious threat of losing their businesses.
QFF is currently working with its industry members and other agricultural representative organisations to launch a concerted lobbying campaign to resolve this poorly thought out change to the backpacker tax. QFF and its industry members will not sit idly while the viability of certain agricultural industries and communities is challenged. The Federal government is showing poor judgement by proposing changes that will undermine the future of cotton, fruit and vegetable industry models.
QFF will be working closely with its members Cotton Australia, Growcom and other industry bodies to ensure the government properly understands the impacts and damage to regional communities a change to the backpacker tax will have. We cannot allow the current lose-lose-lose situation where the backpackers stop coming, the growers and farmers are affected and the local rural economies are put in unnecessary jeopardy.
