Tax rate fair: Producers
IN THE wake of fresh legal proceedings against the Federal Government over the validity of the backpacker tax, Granite Belt producers in the Granite Belt are rallying behind the current 15percent tax rate for backpackers - brought in a year ago - which they supportbelieve is not bad for business.
Legal action, which has been started on behalf of working holiday- makers from eight countries, was initiated by accounting firm Taxback.com, arguing that the tax contravened non-discrimination clauses built into tax treaties that Australia has signed with eight countries: the UK, USA, Germany, Finland, Chile, Japan, Norway and Turkey.
Taxback.com commercial director Eileen Devereux said the action was necessary to protect foreign workers and Australia's reputation as a working holiday destination.
This week Growcom chief advocate Rachel Mackenzie Queensland's peak representative body for horticulture said she had "no real concerns” about the legal action.
"We're happy with 15percent but if it's found to be unlawful and it goes back to the tax-free threshold, then we're fine with that,” she said.
"It's natural that anyone would like to pay less tax.”
Meanwhile, producers and industry representatives throughout the Granite Belt and beyond have been quizzed about the effects of the Backpacker Tax which was introduced in January.
The 15 per cent flat rate on earnings up to $37,000 came into effect following widespread controversy and strong criticism of original government plans to set a backpacker tax at 32.5 per cent., a proposal which triggered grave concerns for the future of working relationships, and supply of backpacker labour, across the industry.
Karen George, Project Manager and Agriculture Workforce officer for Southern Queensland with Queensland Agricultural Workforce Network (QAWN), Growcom, last week collated results from a questionnaire sent to a range of growers and industry heads in a bid to gauge the effects of the tax.
Ms George said she contacted people from Stanthorpe to Caboolture, the Lockyer Valley, Scenic Rim, and throughout south-east Queensland.
"The general response is no, it hasn't had any impact on demand for work from backpackers at all.
"The growers view 15% as a good outcome. If it had been 32.5%, it would have been a different outcome.
"There has been no obvious withdrawal of people looking for work.”
Ms George said she believed the industry had an exciting future and "if things remain as they are now we've got a prosperous 2018”.
"If we can keep that rate as it is we'll have a lot of job seekers for seasonal work and enough farmers to meet our needs.”
Chairman of stone fruit body Summerfruit Australia - Australia's peak stone fruit industry body - Andrew Finlay, said the 15percent tax had not put the operation of farms at risk.
Mr Finlay, who owns and runs Pikes Creek Orchard near Stanthorpe, said: "From my perspective it's working really well and I think the farmers would agree.” It's a non-issue now. The rate of tax doesn't get mentioned.
"When the backpackers look at what they're getting paid and what they get to keep and, also compared to what they might get in their home country, it still is very attractive to them.
"I've had no adverse comments.”
He said there had been uncertainty around the time of the tax debate a year ago "and it became political” but that settled was the decision was finalised.
"I've not noticed any difference in being able to get employees. The test will be February and March when all the crops are being harvested and when there's peak demand for labour ... then we'll see if there's been an impact.”
Mr Finlay said backpacker numbers had fallen slightly in the few years before the Backpacker Tax was introduced, but were currently steady.
"For most backpackers, working is a way of seeing Australia and paying for their travels. Very few take any money out of the country. Australia is an easy country to travel in and they get good rates of pay.”
Jeff McMahon, who runs McMahon Brothers growing organic fruit and vegetables, said he was had also been happy with the 15 per cent rate.
He believed some backpackers who earned about $1000 a week had the chance to earn about $48,000 (gross) a year.
Mr McMahon, who employs about 80 backpackers a year with a maximum of 40 at any one time, said he believed some European backpackers had chosen to work and travel in New Zealand over Australia when the proposed rate of 32.5 per cent was under review.
"That was because they were planning ahead, but it was only temporary.”
He said backpackers were "absolutely essential to our operations” and he "felt sorry” for the government over current legal proceedings.
"I feel a bit sorry for the government really as they've dealt with the issue and everyone's happy with it. They've done the best they can.”
Rosie Savio, who owns and runs P Savio and Co apple orchard at Pozieres and is the Queensland Director on APAL (Apple and Pear Australia Ltd) said she hadn't had any complaints about the 15% tax and had not experienced a shortage of backpacker labour.
BEST Harvest Labour - which recruits farm workers for local farms in the Granite Belt and surrounding regions in Southern Queensland through a contract with the Department of Employment - said they had not seen a drop in numbers because of the tax.
According to BEST Harvest Labour Manager, Linda Clutterbuck, more than 4000 people in the Stanthorpe area worked and job-hopped, of which the majority were backpackers on visas with working rights. And the backpacker tax of 15% had not deterred workers from looking abroad to Australia.
"When the tax was in its early stages there was a bit of a drop off in the number of worker from Europe, but in the last couple of months there has been an excess of people, and even today there are many people still waiting for work.
"We have noticed a change in demographics with more French and Italian backpackers looking for work. Many Italians have commented that they pay a much higher tax in Italy.
"I think there's plenty of backpackers on the ground and I hope we can find jobs for them and keep them here and keep them coming.
"The backpacker market is essential to ensuring fruit is off the tree or picked from the ground when ripe, and is doing well under the current tax agreement.”
However, Federal Member for Kennedy Bob Katter has applauded the move by Taxback.com for commencing legal proceedings.
Mr Katter said the move was "vital” to the long-term survival of tourism and horticulture in Australia.
"Almost certainly the government will lose this case in the International Courts.
"The backpacker tax has dealt a deadly blow to the tourism, bananas, mangoes, paw paws, blueberries - the whole horticulture industry.”