Tasmanian farmers, backpackers, and tourism industries celebrate end of backpacker tax debate

Farmers, backpackers and tourism companies across Tasmania were breathing a sigh of relief on Friday after the long and controversial backpacker tax debate finally came to an end. 

A 15 per cent backpacker tax passed through the Senate on Thursday night, with a deal between the government and the Greens also securing a drop in the superannuation rate for backpackers from 95 per cent to 65.

It was 18 months ago that a 32.5 per cent tax was first proposed by the government, but it went on to be dropped to 19 and then the final 15 per cent. 

Primary Employers Tasmania chief executive Keith Rice said farmers were already feeling relieved and ready to get on with their work for the season. 

“We’re delighted that we’ve got some certainty to it now that it’s over and done with,” Mr Rice said.

“I don’t think people outside agriculture could understand the stress these people were under.

“Their harvest is their income and if that couldn’t be harvested it was lying on the ground rotting - the stress for them would be absolutely enormous.” 

Mr Rice said backpackers in Tasmania were already planning on extending their stays since the debate ended on Thursday night,

“Just to hear the relief in the voices of the fruit and vegetables growers is so rewarding,” he said.

Forth vegetable farmer Rick Ertler from Premium Fresh Tasmania said he had been watching the debate closely, he even took a trip to Canberra. 

Mr Ertler employs about 150 backpackers in the peak season, both on the farm and in the factory. 

“We needed to have some resolution, we couldn’t go forward,” he said.

“Nobody actually thought it would ever go through at 32 per cent … some of our current backpackers had written down what they thought and they all thought they would go somewhere else if the tax was 32 per cent.

“I think 15 per cent is an excellent result.” 

The Tasmanian Tourism Industry Council said the uncertainty had caused backpacker tour companies to see a decline in bookings.  

“The 15 per cent tax rate, brought down to 13 per cent with the changes to superannuation, is competitive with New Zealand,’ the council said.

“Ultimately the market will respond over coming months and years in terms of the long term effect on working holiday makers to Australia.”