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Australian Government Executes Lower ‘Backpacker Tax’; Coalition Eyeing To Drop Rate To 15 Percent

Travelers Today       By    Jovie Lyn Alejandro

Updated: Nov 28, 2016 06:35 PM EST

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employment , australia , Australia news , Finance , working , occupation , people , tourists , visa , tax
The Australian government is eyeing to impose a 15% tax rate on working holiday guests.
Australia is one of the countries that attracts huge number of tourists around the globe not only due to its natural wonders but it also gives opportunity for backpackers to work overseas.
(Photo: Scott Barbour/Getty Images)

Australia is one of the countries that attracts huge number of tourists around the globe due to its natural wonders, pristine beaches, architectural tourist attractions and also an opportunity to work overseas. The booming increase of tourism caught the government's attention and wants to deliver more good news to its foreign visitors. The Australian government is eyeing to impose a 15 percent tax rate on working holiday guests.

A proposed new "backpacker tax" which is way lower than the government's original plan for a 32.5 percent rate for tourism and farming operators. Today backpackers, like Australian workers, do not give any tax until their annual salary exceeds A$18,200. The administration fear that taxing provisional workers higher than their proposed percentage will be a threat to lower tourism rate and would drive away visitors.

Estimated 600,000 tourists travel to the country every year not just to experience leisure activities but also for a chance to be able to earn and save money while staying in the region. Most of those that want to have extra funds end up finding work picking fruits. Treasurer Scott Morrison stated that the government had grasped a compromise deal with independent crossbenchers. According to ABC News the revised bill has a potential to pass the Senate with the help of Derryn Hinch and those from the Nick Xenophon Team, the main crossbenchers.

"Today the government will be working to put in place a bill which will propose 15 percent on the backpackers' arrangement. We will honour the arrangement that we've come to with Senator (Nick) Xenophon and we appreciate his continued support on this, as well as Senator (Derryn) Hinch," Morrison stated in a report from BBC News.

The backpacker tax debate has been a hot topic which opposing parties have different point of views regarding the taxable percentage.  Independent Senator Jacqui Lambie proposed 10.5 percent tax rate was bumped off by the House of Representatives last week. Labor remains committed on pushing the same percentage saying that it is the only rate that will reestablish Australia's international standing and competitiveness among backpackers. While many within the National party are assured that Labor would finally settle to 19 percent.


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