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Vic farmers call for end to political games over backpacker tax

VICTORIAN farmers are calling for an end to the relentless political games being played over the backpacker tax after the Labor Party today rejected the Federal Government’s proposed 19 per cent tax on working holiday makers.

Opposition Leader Bill Shorten announced earlier that Labor would instead support a new tax rate of 10.5 per cent, put forward by Tasmanian senator Jacqui Lambie.

"It is incredible that we have been talking about the impacts of this tax on the agriculture industry for 18 months and we still don’t have a resolution," Victorian Farmers Federation Horticulture Vice President Emma Germano said.

"All sides of politics have shown complete contempt for our nation’s food producers by refusing to agree to an equitable tax rate for backpackers."

The VFF and its partner organisation the National Farmers Federation have campaigned vigorously for the Government to scrap its original 32.5 per cent backpacker tax in favour of a 19 per cent rate to maintain Australia’s position as a competitive destination for working holiday makers.

Industry leaders flagged the 19 per cent rate during a Government review of the planned tax in April, which was rejected at the time but later announced by Treasurer Scott Morrison.

"If this issue isn’t resolved within the next three weeks of Parliamentary sittings, we will be stuck with the higher tax rate when the backpacker tax is implemented in January," Ms Germano said.

"Most farmers will be harvesting their crops in the new year when they’ll need support from backpacker labour, so this would be a truly alarming outcome.

More than 40,000 visa holders work in the agriculture industry each year and contribute around $3.5 billion to the Australian economy.

But Ms Germano said the deadlock over the backpacker tax had already led many working holiday makers to look at alternative destinations.

"We have seen a decline in backpacker numbers to Australia since the tax was announced in last year’s budget and some farmers who rely on working holiday makers as a vital source of temporary labour are starting to panic," she said.

"The Senate needs to find a compromise position before time runs out to give confidence to the agriculture sector."

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