THE federal government’s change of heart on the backpacker tax has been welcomed by North East industry, farmer and tourism groups.
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Under a compromise deal on Tuesday, the government dumped its proposal for a 32.5 per cent tax on backpacker labour in favour of a 19 per cent tax.
Winemakers of Rutherglen chairwoman Belinda Chambers said the winegrape industry welcomed the decision.
“Any reduction in the backpacker tax is very favourably viewed,” she said.
“Backpackers are important for both tourism and the seasonal labour markets.
“With labour shortages in rural areas it’s very important to encourage seasonal workers.”
Ms Chambers said backpackers made up about 5-10 per cent of tourism in the region and as much as 15 per cent of seasonal workers during peak vintage.
“In order to attract backpackers we have to offer a wage that is appropriate for the cost of living in Australia,” she said.
“If the tax pushes them below the (economic) survival line, it’s obviously a big negative.”
Independent member for Indi Cathy McGowan said the agriculture and tourism industries had undergone a 16-month campaign to settle the backpacker tax issue.
“The outcome was good, but rural and regional people should not have been put through the rigmarole, expense and stress of having a tax that was clearly damaging hanging over their heads for so long,” she said.
Ms McGowan called on the government to learn from its mistake.
She said it needed to do its research before making decisions that impacted rural and regional Australia.
“The government could get its policies right the first time if it consulted relevant industries and engaged with rural and regional communities before making uninformed decisions,” she said.
“This would save considerable time and expense for those people affected.”
The tourism sector will gain $10 million to market jobs to backpackers as part of the deal.
Ms Chambers said increasing scarcity of seasonal labour continued to plague the industry.
“The tax (backflip) is certainly welcome but really the issue in regional areas is the scarcity of labour,” she said.