THE deferral of the backpacker tax, which would have removed the tax-free threshold for working holiday makers, has been welcomed by the Hills Orchard Improvement Group (HOIG).
From July 1, working holidaymakers were facing paying 32 per cent tax from the first dollar they earned.
But Federal Assistant Treasurer Kelly O’Dwyer announced today the tax would be suspended for six months pending a ministerial review led by Nationals leader Barnaby Joyce.
Nearly 48,000 people signed an online petition calling for the plan to be dumped.
HOIG spokesman Brett DelSimone said the backdown was a win for the horticultural and tourism industries.
“We feel that this will be the death of the backpacker tax as we know it,” he said.
“It is now incumbent upon the Coalition to reinforce confidence of workforce supply within the horticultural and tourism industries, including within the countries from which our backpacking workforce originates.”
The proposed tax would also have hit the tourism and hospitality industry hard, according to peak industry body Restaurant and Catering Australia (RCA).
“The tourism industry is currently experiencing a shortfall of 38,000 staff, with this number expected to widen to 123,000 by 2020,” RCA chief executive John Hart said.
“Jobs growth alone in the cafe, restaurant and takeaway sector means an additional 84,300 jobs will be required by 2020.
“We cannot underestimate the importance of transient workers to our industry.
“With a jobs growth rate of 14.9 per cent, the backpacker tax would further restrict our access to staff.”