Local, Independant and Effective
May 13, 2016

Backpacker tax will harm local economies: Cathy McGowan

Independent Member for Indi, Cathy McGowan AO is repeating her call for the Government to listen to the agricultural and rural tourism sectors and scrap the backpacker tax increase. Ms McGowan has served on numerous committees with the National Farmers’ Federation and Victorian Farmers Federation and fully supports their ongoing campaign.

“I am joining the NFF and the VFF in calling on the Government to stop the increase of the backpacker tax,” Ms McGowan said. Ms McGowan supports the current 19.5 per cent tax arrangements and shares industry concern a rise to 32.5 per cent on July 1 would harm local economies.  

“In response to a huge backlash in March this year, the Government committed to a review of the backpacker tax. Sadly there was nothing in the 2016-17 Budget to address this issue. I’m calling for an immediate six-month moratorium on the introduction of the tax increase.” 

Ms McGowan said the tax increase will hit three groups and the impact is already being felt.

“Backpackers themselves are choosing not to come to Australia to work, the businesses who rely on backpacker labour are now having trouble filling positions, and the economy of local communities will lose income through a drop in business, including accommodation, food and entertainment,” Ms McGowan said.

Bogong Horseback Adventures owner Kath Baird said the money would be much better spent in local communities.

“There’s much less incentive for young travellers to come to Australia and follow that dream they have of working here,” Ms Baird said. “In my experience, with every young traveller that’s ever come to stay with us, they rarely leave with any money, they spend it right here in our community.

“We’ve already seen the impact with less people contacting us to offer to come and help us run the business, which a very labour intensive job. And it’s not just us; it will impact other tourism operators in the Alpine Valleys.”

Ms McGowan said she was surprised the Government was ignoring the plea of the NFF, VFF and tourism industry to reconsider this backpacker increase.

“This is another example of the Liberal and National Party Government not understanding an important issue in rural and regional Australia,” she said. 

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