In what could be called an important development, plans to make global backpackers in Down Under give tax on their wages looks likely to be ended, post a drive from tourism and agriculture businesses generated fears.
The tax on those in Australia on the Working Holiday Maker Visas, who can proffer their professional services through their stay in the nation, and which was to be launched during the month of July, is presently being evaluated, and the possibilities are high that it will be scrapped.
Tourism bosses had issued the warning that the proposal to remove backpacker from the tax-free threshold could bring major decline in the figure of backpackers which would afterward affect numerous businesses that depend on them for temporary work.
Since long, backpackers have been allegedly motivated to do a job in the Kangaroo Land on the Working Holiday Visas which let them to live for a second year, in case they offer their professional services, for a period of three months in rural regions. The latest tax would have required guests on the Working Holiday Visas to give 32.5% on every dollar taken home, when they formerly gave no tax on the earnings up to 18,000 dollars.
As per Richard Colbeck, the in-office Tourism Minister, he has taken the fears on board. He elucidated that the Working Holiday Makers are essential for two of Australia’s major super growth sectors for the coming 10 years, namely, agriculture and tourism. Fears have been raised about the effects of the 2015 budget measure on tax structures for the Working Holiday Makers, predominantly the nation’s international competitiveness as a backpacker hotspot.
The minister added that the government has so come to a decision that the proposed tax arrangements necessitate more dialogues to guarantee Oz’s market share in backpacker visitation remains unchanged. The important matter is to make sure the nation has a rather balanced & just approach to the tax position for employees in the country on visas.
People against the tax indicated that in the tourism business alone, Oz is seeing a famine of 127,000 employees in the coming 5 years. Although more than 90% of the employees in the tourism business are the nationals of Down Under, the business depends on the labor force from out-of-the-country for the rest. An additional 40,000 Working Holiday Makers yearly make a handy contribution to the riches of the broader agricultural segment, and this includes the general agriculture & horticulture segments.
Reportedly, the concerned Australian body had supported the move even as it has taken a lead in elucidating the effects of the planned tax, which according to it is “ill-conceived”. Allegedly, in place of treating the Working Holiday Makers as an unproblematic source of tax revenue, the administration would do well to identify the economic gains they bring to small organizations and their Australian manpower.
