DARWIN CONVENTION CENTRE
WEDNESDAY, 13 APRIL 2016
SUBJECT/S: Backpacker Tax
JOEL FITZGIBBON, SHADOW MINISTER FOR AGRICULTURE, FISHERIES AND FORESTRY, SHADOW MINISTER FOR RURAL AFFAIRS: I’m here with Luke Gosling, Labor’s Candidate for Solomon, to talk about a very significant threat to the Northern Territory economy. The Backpacker Tax was a cash grab on Budget night with no consultation done with the sector, and no consideration undertaken of the impact on the local economy.
Luke calls it the Northern Territory Tax and that’s pretty apt because nowhere will the backpacker tax hit harder than here in the Northern Territory. This morning we were down at Tou’s farm where we heard from the principals in that mango farm of the impact of the back packer tax. There, their workforce is 95 per cent made up by foreign workers
Her farm and horticulture projects right across the Northern Territory and indeed, right across the country will be hit.
Now the Governments response is to have not just one review but two reviews and the Government has already missed its own deadline for those reviews. In the meantime all these farming enterprises are working with uncertainty. They don’t know what’s ahead for them in terms of the Backpacker Tax. But they do know one thing, they simply cannot get the labour they need in picking season here in the Northern Territory without backpackers and there is no doubt that the Backpackers Tax will send backpackers away from Australia and to other jurisdictions where they don’t have to pay this tax. This was a mistake, it’s easy to fix and the Government should announce the fix today.
JOURNALIST: So you wouldn’t see any tax [inaudible]
FITZGIBBON: Well I’m insisting the Government backflip on this, go back to the drawing board, do some economic modelling, do some consultation with the farm community to work out what is doable here and what is not. This precipitous Budget night announcement without any consultation was a big mistake. The Government has effectively admitted the mistake by commissioning not one but two reviews but its time it absolutely admitted that it got this wrong and time it fixed the problem.
JOURNALIST: The NFF has been arguing for a lower rate that’s going to land somewhere they argue around about 19 per cent. Would the Opposition support the position?
FITZGIBBON: I want what’s best for the farming community. The NFF has put forward a proposal which would do nowhere near the harm as the Government proposal. We want to see the economic modelling; we want to know exactly what backpackers spend for example in this country when they come to work here. My experience is that everything they earn here is spent here and of course, the expenditure creates economic activity and of course when they spend here they pay a GST as well. I want to see the economic modelling on both sides of the equation but what the Government must do today is put some certainty into this equation for farmers and make it clear that it understands that it made a mistake and it is not going to proceed with the Budget night initiative.
JOURNALIST: Given how important backpackers are for the labour force especially up here, what does it go towards the developing of the North; does it go right against that?
FITZGIBBON: Well we are here in Darwin talking about the future of the North and further developing economic activity in the North and you can’t do it without a workforce and this Backpackers Tax is exodus missile right into the heart of the workforce here in the Northern Territory. So if the Government was serious about talking about development of the North it would today admit that it got the Backpacker Tax wrong and it would go back to the drawing board.
JOURNALIST: Sorry just to clarify something. Would you support the tax at 19 per cent.
FITZGIBBON: Well obviously I’m inclined to support the NFF’s view on this issue. They of course directly represent the farming community but again I want to see the economic modelling done, I want to better understand what are the impacts of this Tax on both sides of the equation. My main objective now is, from today, to convince the Government that it is time to put certainty back in to the sector. To admit it got it wrong and to clearly rule out the taxation arrangement they announced in the Budget. Thanks everyone.