The Australian government has come to an agreement on the 'backpacker tax', passing legislation to tax working holiday makers at a rate of 15 per cent.
The backpacker tax passed the Senate with the support of the Greens on 1 December, though the proposed plan to tax 95 per cent of backpackers’ superannuation has been brought down to 65 per cent.
The motion was passed on the year’s final parliamentary sitting day, ending more than 18 months of political back-and-forth over the tax rate, which ranged from 32.5 per cent to 10.5 per cent and in between.
Australian prime minister Malcolm Turnbull thanked the Greens and senators Pauline Hanson and Nick Xenophon for their support, and said that the deal would “provide security and assurance for farmers and many industries across Australia”.
"We don't agree with this government on many things, but in the end our responsibility in this place is to the community that we serve," said Greens leader Richard Di Natale, adding that this was a “commonsense victory for farmers”.
"Ultimately what we faced was going away from this place with regional Australians being sent to the wall and we weren't going to let that happen."
Industry bodies and growers have welcomed the resolution, though the government has been criticised for its approach to developing this policy.
“This outcome means that after 18 months of confusion and uncertainty, Australian growers can now finally move forward with certainty about the future of the working holiday maker program,” said Ausveg CEO Simon Bolles. “The treatment of the backpacker tax issue is an indictment on our current Parliament, with growers seen to be held to ransom by political games until the last sitting day of the year.
“This must never happen again. The farmers and growers of Australia deserve better.”
Growcom chief advocate Rachel MacKenzie said growers could now breathe a sigh of relief, with the tax rate on par with that paid by people employed in Australia under the Seasonal Workers Programme.
“A 15 per cent tax rate will ensure that Australia will continue to be seen overseas as an attractive destination for working holiday makers. That we had to go through this disgraceful political circus for the past 18 months to get to this point will not be forgotten by growers in a long, long time,” Mackenzie said.