Jun 21, 2016

Coalition shambles on backpacker tax exposed

The Prime Minister and Treasurer have been exposed for their lies in claiming that the supposed six month ‘deferral’ of the Government’s backpacker tax would be “reflected in the PEFO”.

It is clear that the Liberal Party has bungled the backpacker tax from the start and now they’ve bungled its delay.

JOURNALIST: Prime Minister, the cost of the backpacker tax is some $500 million over the forward estimates, have you have factored in how much that will cost to delay that by 6 months and how much potentially the changes could cost the Budget?

PRIME MINISTER: I can assure you that all of those matters have been taken into account and will be reflected in the PEFO.

Doorstop – 17 May 2016

SCOTT MORRISON: The decision we took today had already been provisioned for and taken into account.

Reported by ABC PM – 17 May 2016

These comments were made three days before the Pre-election Economic and Fiscal Outlook (PEFO) was released.

The PEFO came and went without any sign a deferral in the backpacker tax measure, and the associated revenue cost, had been ‘provisioned for’.

Then yesterday, the cat was let out of the bag, with the www.electioncostings.gov.au website posting Liberal Party election spending promises, including the deferral of the backpacker tax.

In a major embarrassment for the Prime Minister and Treasurer, the costings request for this deferral cited the date of the announcement as being 17 May 2016, but the date for seeking the costing request, was 17 June 2016. So the Liberal Party has not had a formal costing of this deferral for the month following the announcement.

This follows the Australian Tax Office first providing, then retracting, public advice that the backpacker tax measure would commence on 1 July 2016.

The Government’s mishandling of this issue has caused great uncertainty in the tourism, hospitality and agriculture sectors in particular.

There are around 145,000 working holiday makers present in Australia at any time, employed across the hospitality, tourism, construction and agricultural sectors. 

Research by the Department of Immigration shows that working holiday makers are net job creators, particularly in regional areas, spending more than they earn while providing much needed seasonal labour. 

But the major uncertainty created by the Coalition since the announcement of backpacker tax and the subsequent confusion has seen applications and arrivals drop significantly, jeopardising harvests across the country. 

This bungling and dissembling is just another reminder that Malcolm Turnbull can’t be trusted when he makes basic policy commitments.