A backpacker tax rate of 15 per cent was introduced into the Senate on Wednesday, where it was knocked down by Labor, the Greens and independent Senators.

This meant the amended bill would head back to the House of Representative to be debated.

On Monday, the government announced it would compromise on its already-dropped rate of 19 per cent to bring it down to the 15 per cent rate.

This came after the tax was initially introduced 18 months ago at 32.5 per cent for foreign workers.  

Tasmanian Liberal Senator Jonathon Duniam said uncertainty for the horticulture and tourism sectors will now continue.

“The government has worked with cross benchers continuously, seeking to reach a sensible compromise which will give industry an international competitive tax rate and certainty,” Senator Duniam said. 

Tasmanian Senator Jacqui Lambie, who first introduced the 10.5 per cent tax rate into Parliament last week, said a 10.5 per cent rate would make the country competitive. 

“Every Australian farmer and visiting backpacker knows that New Zealand’s headline tax rate for backpackers is 10.5 per cent - and if we are going to have a lasting and competitive backpacker tax rate, ours also must be set at 10.5 per cent,” Senator Lambie said. 

Braddon Labor MHR Justine Keay said the money that was to be spent on marketing to attract backpackers should be used in other places. 

“Local industry is already struggling to attract seasonal labour and I know the tourism industry is increasingly concerned backpackers will not make the decision to travel to Tasmania given they now have a reduced income,” Ms Keay said. 

Question time in the lower house was disrupted for about 30 minutes on Wednesday when almost 40 pro-refugee protesters glued their hands to a railing.