Australian lawmakers approve backpackers tax for working travelers to the country

UPI

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People who travel to the country and opt for seasonal, temporary or migrant work will be taxed at a 15 percent rate, settling an 18-month debate.

Legislators in Australia compromised on a tax level for backpackers who travel to the country on work visas, settling an issue that had farmers and some in rural areas concerned about the availability of employees.

Members of the Australian Senatecame to an agreementwith Prime MinisterMalcolm Turnbullto install a tax rate for backpackers, setting a 15 percent tax rate that many said would allow farmers to afford to pay people who pick fruits and vegetables during season.

Turnbull had at first asked for a 32.5 percent rate for those on working holidaymaker visas which allow people from Asian and other countries to find work -- much of it on farmers and doing similar physical labor -- and be paid at levels competitive to other countries in the southern Pacific.

Most Australians don't pay tax on their first $13,500 of income, paying higher rates as their salary goes beyond that level, but Turnbull and other officials sought to increase government revenue by applying a tax level to the seasonal and occasional workers coming from other countries.

During the last 18 months of debate on the topic, there have been several ideas put forward, from the 15 percent compromise that came up in the last week, although some members of the opposition favored levels as low as 13 percent and 10.5 percent. Had the government done nothing, backpackers would have been required to pay 32.5 percent of their pay in taxes.

The 15 percent compromise rate is thought by officials who voted for it as a good agreement because anything higher may have made other countries with lower rates -- New Zealand taxes the same group of workers at 10.5 percent -- have an upper hand in drawing the workers they need.

Coming to a compromise was a big deal, so that workers knew what they'd be earning and be responsible for paying, and settling the minds of farmers who need seasonal employees.

"[This is] a very, very sensible commonsense package that is going to benefit agriculture... and give backpackers the certainty that they need," said Fiona Simson, president of the National Farmers Federation.

(UPI)