Brian Mitchell (Lyons, Australian Labor Party) Share this | Hansard source

Eighteen months ago. I want workers on farms, picking fruit and getting produce to market. That is my sole motivation. If I had evidence before me that reducing the coalition's backpacker tax from 32.5 per cent to 19 per cent would get workers on farms I would be the loudest voice on this side of the parliament to bulldoze this through. But where is the evidence this will work? Where is the research proving the change will have real effect? Where are the surveys of the backpackers demonstrating the positive impact on their travel plans? Who has asked them whether reducing the rate to 19 per cent will bring them here? I suspect the evidence does not exist and unfortunately, with this mob, 'just trust us' does not cut it. Those opposite show time and again they should not be trusted with a butter knife, let alone the affairs of state.

This is the Treasurer's mess, but right up there as a willing supporter of this mad scheme is the Deputy Prime Minister, the member for New England—Baldrick to the Treasurer's Blackadder. What a great friend of the farmer the Deputy Prime Minister is—backing a tax that hurts fruitgrowers and sucks revenue out of regional communities. He and his Nationals colleagues make up one-fifth of the cabinet but between them they could not muster up the guts to oppose the Treasurer's tax on regions. The Deputy Prime Minister was in the House last week praising the tax. It is the most vocal he has been on this issue for more than a year. He was certainly mute when it counted most. Regional communities suffering from this new tax could not find him hiding under his big hat. Many might count it as a good thing that the member for New England remains silent whenever possible, but it would have been nice to hear him stick up for farmers and our regional communities. But of course he did not speak up when it counted, only when it became politically convenient to him. I listened to what the Deputy Prime Minister had to say last week and I even went to the trouble of reading his media statement on this matter. Life is short and I will not get those moments back, but his words did serve to remind me of what I can buy for two bucks a bag at farm gates throughout my electorate—and I do need to spread it soon.

The sad fact is this reduction in the coalition's backpackers tax from 32.5 to 19 per cent is more about a political fix than fixing the problem. It is about getting this disastrous blunder out of the headlines, not getting workers onto farms. The Treasurer created this mess by introducing the coalition's backpackers tax in his 2015 budget. It was then, and it remains, an ill-considered tax—a mad, crazy tax is how I have described it previously, and I hold to that description. My preference has always been for its abolition. I want it gone, full stop. I make no bones about that. I do not buy arguments that we cannot afford its abolition. This government wants to waste $200 million on an opinion poll and give $50 billion in corporate tax cuts. It has even found $160,000 to give my predecessor, Eric Hutchinson, a job attending functions on behalf of the President of the other place. Revenue and expenditure is a matter of priorities and I will support farmers and regional communities over bankers and former politicians any day of the week.

The coalition's backpackers tax as it stands right now will suck $500 million from regional economies and send that income straight to the ATO in Canberra. And that is the best-case scenario—$500 million less to be spent in shops and on services in regional communities across Australia. At worst, this tax will drive backpackers away, creating a severe labour shortage on farms, and will earn little for the ATO because of the simple fact that backpackers who do not come here do not pay tax. So farmers miss out on labour, communities miss out on workers' spending power, and the Treasurer—who has joined the chamber—misses out on the tax he was expecting to collect. It is a trifecta of failure and incompetence.

Sadly, it seems that the worst-case scenario is the one that is coming to seem the more likely outcome. Labour firms are reporting massive falls in the level of interest from backpackers. Backpackers are complaining that the tax rate is too high, and they are changing their working holiday plans for competing destinations like New Zealand.

All this should have been sorted out before the Treasurer announced his 32.5 per cent tax grab. But, through incompetence or arrogance or both, he failed to do his job and his due diligence. He went for the easy score. Now, after more than a year of damaging headlines and plummeting prospects for fruit growers and farmers, and after being dragged to the negotiation table by farmers and Labor, the coalition is proposing a compromise: a tax of 19 per cent instead of 32.5 per cent. But, with its trademark arrogance, the coalition is demanding that the 19 per cent be waved through the parliament immediately, while tagging on a brand new 95 per cent tax on superannuation earnings and an increase in the departure tax that has our tourism sector up in arms. 'Don't take a close look at the detail; don't examine whether the proposed measures will actually work; just pass it all right now, or the sky will fall in!' That is what they demand.

Well, on this side of the House we are more diligent than that. We are more calm, and we are more considered. This government has dithered with this legislation for more than a year and done nothing in the three months since the election. It might be panicking, but we are not. Labor will do its job properly.

As lawmakers, we need some measure of certainty, based on evidence, that the laws we pass will have the impacts that are intended. That is why Labor will send this bill to the Senate economics committee. The committee's work will not delay passage, but it will seek answers.

From my perspective as the member for Lyons, there is nothing good in this tax for the people I represent, at 32.5 or 19 or any other percentage. I know there is someone in the other place proposing a 10 per cent tax. I have made my own preferences clear. But I do not think we should rule anything out before we have all the facts at our disposal.

It is important to remember what this issue is really about. It is really not about backpackers; it is about practical labour solutions for Australian farms, and that is my focus. Many of the farms in my electorate do try to source their labour locally before employing backpackers, but the work is isolated and seasonal, so there are difficulties.

Everyone knows that Tasmanian cherries are the best in the world, but they are fiddly to pick. It is hard, hot work, and cherry growers rely absolutely on backpackers.

See this speech in context