Agribusiness & Food

Budget helps farmers, but concern raised over backpacker tax

The National Farmers’ Federation has welcomed key measures in the federal budget it says will benefit agriculture, but says higher taxes for backpackers will hurt the sector.

The NFF appealed before the budget for treasurer Scott Morrison to remove a proposed 32.5% tax on all income for all working holiday makers, known as the “backpacker tax”.

Brent Finlay, the president of the NFF, said the tax, which was not scrapped on Tuesday night, was destructive.

“There were literally thousands of farming families, agricultural businesses and tourism operators who were desperately hoping the backpacker tax, in its current form, would be abandoned in tonight’s budget,” Finlay said on Tuesday.

“We have received more than 31,000 signatures on a petition opposing this measure.

“We have banded together, both as an industry and across sectors, to show that the negative impacts will be wide-reaching and felt by thousands of Australian families.”

Finlay is hopeful the government will still move to respond to the industry’s concerns before the election.

After handing down the budget, federal treasurer Scott Morrison told the media he “may well have more to say” about the tax in coming weeks, according to an ABC report.

Aside from the backpacker tax, the NFF was pleased with the budget.

“There is no doubt we are delighted to see the tax burden on small business eased,” Finlay said, “with a 2.5% tax cut for small companies, an increase to the tax discount for unincorporated entities, and more generous deduction rules.”

Finlay also welcomed funding for the Inland Rail project, but said more was needed “to break ground” on the inland line between Melbourne and Brisbane.

“Never before has agriculture been so strongly positioned to grow the Australian economy and contribute to the prosperity of the entire nation,” he concluded.

“We look forward to hearing policies from both the Government and Opposition that will help us take hold of these opportunities and deliver economic and social returns for the nation.”

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