Australia backpacker tax would hurt tourism
New research suggests a proposed ‘backpacker tax’ for travellers on working holidays in Australia will significantly impact the country’s tourism and rural agriculture industries.
The federal government plans to tax working travellers at 32.5% from the first dollar earned, which has been widely criticised by tourism stakeholders.
A survey conducted by YHA Australia and Monash University found 60% of recent travellers would not have come to Australia if the tax rate was already in force.
More than half of backpackers would spend less time travelling in Australia and 69% would have likely spent less money on tours.
The survey polled 335 international working holidaymakers staying in hostels in Cairns, Port Douglas and Melbourne earlier this year.
“The findings generally were that the backpackers were pretty alarmed. I think the difficulty is that mostly we’re talking about people picking up casual work on around about the minimum wage, $21-$22 an hour and if a third of that goes in tax from the first dollar you earn there’s only about $14 left for food, transport and accommodation,” said YHA CEO Julian Ledger.
Ledger says rural businesses which rely heavily on transient labour would suffer.
“We just need to remember that they don’t have to come here and they don’t have to work here if they do come and they can easily vote with their feet and not participate if we make the terms of their employment sufficiently unattractive.”
The survey also said 62% would choose to go to New Zealand instead of Australia if the tax comes into force.
The proposal is currently under review by the federal government and submissions regarding the issue are being accepted until September 2.
The government has said the tax, even if amendments are made, will come into force at the beginning of 2017.
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Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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