Farmers embraced lower backpacker tax

The government scrapped their initial proposal of taxing those on working holiday visas 32 cents on the dollar from the first dollar they earn, instead opting for a 19 percent tax rate on any earnings up to $37,000. 

To make up the shortfall, the government will take 95 cents of every superannuation dollar earned when backpackers leave the country. 

Member of NSW Farmers Business Economics and Trade Committee and Cootamundra resident Peter McClintock embraced the new proposal.

“The reduction is certainly welcome, the 32.5 percent that they were proposing was completely ridiculous.

“We’d prefer it to be lower but we realise that the government needs to have income measures somewhere along the way,” Mr McClintock said. 

According to Mr McClintock, the reduction in the tax brings Australia into line with other working holiday destinations.

“Lowering it makes us competitive with other countries like New Zealand and Canada in terms of what backpackers take home at the end of the day,” he said. 

While the reduction is a step in the right direction for farmers, Mr McClintock is worried the damage has already been done. 

“The proposed superannuation plan doesn’t impress us at all.

“The whole debacle hasn’t sent a good message to backpackers about how welcome they are.

“Farmers will be suffering over the upcoming picking season,” he said. 

The Cootamundra farming community tends not to employ large numbers of backpackers given the varieties of crops grown in the region. 

Mr McClinctock said some farmers in the region do employ backpackers but the tax won’t have a huge impact here. 

That’s not the case just 50km down the road in Young where huge number of backpackers are employed every year during the fruit picking season.