Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

My question is to the Treasurer. Far North Queensland—paradise—is Australia's No. 2 destination for tourists, a quarter of whom are backpackers. It is a tourism industry only facilitated by working on bananas, mangoes, avocados and horticulture. Surely imposing a punitive backpacker tax combined with pointless superannuation pain threatens $1 billion a year in tourism and $1 billion a year in horticulture?

Scott Morrison (Cook, Liberal Party, Treasurer) Share this | Link to this | Hansard source

I thank the member for Kennedy for his question and I thank him for his concern about these issues and those concerns are reflected by a number of members on this side of the House who I have been working with, particularly the Leader of the Nationals, the member for Murray, the member for Mallee, the member for Leichhardt and the list goes on. They are issues that are being addressed in relation to the measure that was introduced in the last budget and that is true. Let us understand what was done in the last budget. What was done was the tax-free threshold was increased to $18,200—for the benefit of the member for McMahon. When that was increased, backpackers who had been paying tax because the threshold had been a lot lower were no longer playing tax. So in the last budget backpackers were treated as foreign residents for the purposes of the tax act. If there are implementation or transition issues that need to be addressed then of course I will continue to work with the government members who have raised this with me, particularly the Leader of the Nationals.

But what we need to understand is if we are to address this issue then we need to address the fundamental question of what is being asked for—that is, that there be a taxpayer funded incentive to employ foreign workers to work in particular industries. That is basically the proposal because it would be saying backpackers would not be treated as foreign resident income taxpayers in Australia. Now if that is an incentive or a concession that needs to be addressed in a particular sector then we would need to identify which sector—is it the hospitality sector, is it agriculture, is it abattoirs or any of these? These are very genuine questions and we will work through those issues. We will also ensure that we will do so in a way that does not impair the budget.