Sydney - A proposed “backpacker tax” could decrease the number of overseas working-holiday tourists to Australia by 60 percent, a study has found.
The Australian government is currently reviewing its proposed 32.5 percent tax on income earned by people travelling on working holiday visas, following complaints from farmers who depend on backpacker labour during harvests.
The study, conducted by Melbourne's Monash University and the Youth Hostels Association, found that 57 percent of working holidaymakers said they would spend less time travelling in Australia and 69 percent said they would spend less money on tours.
Working backpackers currently pay no tax on income up to 18 000 Aus dollars (about R190 000) which is the same amount as locals.
“Working holiday makers have sent a clear message to the government - 'Treat us like a cash cow and we are out of here',” Margy Osmond, from the Tourism and Transport Forum Australia, said.
Many rural and regional communities depended on their spending and the tax system needed to recognise the value of the visitors, Osmond said.
According to the immigration department, Australia granted 226 812 working holiday visas in 2014-15, with Germany being the second-highest recipient country.
The opposition Labor party's tourism spokesperson, Anthony Albanese, said the tax plan had been a disaster since it was announced in May.
“Young people have access to online information and they are going right now to Canada and New Zealand - that's dollars leaving Australia that should be being spent here,” Albanese said.