The federal government announced this week that it has deferred the planned changes to the proposed "backpacker tax", initially intended to be effective as of July 2016, pending further review. They hope to introduce the revised tax on 1 January 2017.
The review encompasses 417 and 462 working holiday visas with the view to ensuring that Australia remains competitive and our labour supply remains adequate. It also aims to evaluate non-compliance with legislation for both employers and labour-hire arrangements.
Terms of reference include:
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Australia's competitive position in attracting seasonal and temporary foreign labour, including wages and conditions, taxation, and worker assistance; -
Regulatory imposts on employers; -
Changes to the use of volunteer or unpaid labour programs; -
Policies to attract unemployed Australians to work in agriculture and tourism; -
Opportunities to expand the supply of seasonal and temporary foreign workers for the agricultural sector; and -
Consistent tax treatment between different classes of tem
The report results are expected in October 2016. With a large outcry over the initial proposal from the hospitality industry, as well as agricultural and rural operators who would be heavily affected by the loss of international labour, it will be interesting to see how the changes pan out.