With much of the industry focus on the “Backpacker Tax”, a recent article in the Sydney Morning Herald highlighted one of the key factors to lower backpacker numbers is attributable to the constant gradual increase to visa costs.
They questioned whether Bill Shorten’s recent comments about a “de-facto strike” by backpackers was due to the backpacker tax, which they suggested it was not and that increase in visa costs was the more likely culpritt as the effects of the backpacker tax have not yet been felt by backpackers. Although it could be argued that the suggestion of this tax and the delay in implementing it and the media reporting it could have added to the figures.
The Herald was quoting figures from official data from the Department of Immigration and Border Protection. Which show the latest stats go up to December 2015 and show the number of applications lodged for working holiday visas peaked in 2012-13, at 264,974.
That fell to 242,050 in 2013-14 and then further to 231,390 in 2014-15. The figures from July to December of 2015 show the number of applicants is still declining, as is the number of visas granted.
So lower backpacker numbers, whats the reason? This generation are the most mobile and interactive and they are seemingly most sensitive to price!
In 2013, the Labor government increased the cost of a working holiday visa from $280AUSD to $365AUSD. It went up again to $420AUSD in 2014. So an increase of $140AUSD in just over a year, in real terms that is around £90 sterling for a UK backpacker – is this really enough to be putting them off from travelling to Australia?
Probably not but when you compare it to the cost of a working holiday visa for Canada ($250AUSD) and a working holiday visa for New Zealand cost Europeans around $258AUSD, therein lies a problem.
Maybe while the government is looking at the backpacker tax, they can look at the visa costs for this group of people. Surely investing in this group of travellers that generate in the region of $3.5billion to the national economy is the better solution? Sometimes you need to invest to get a better return, surely that’s the logic that needs to be applied to the backpacker sector?
Simply continuing to increase visa fees and adding a hurtful tax will surely only succeed in simply robbing Peter to pay Paul.
Here is a link to the full article in the Sydney Morning Herald.
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Tax for working holiday makers.
It is a complete myth that you will automatically get all your tax back when you leave Australia! There is a lot of confusion out there amongst, not only working holiday backpackers but also amongst many employers and even some accountants and tax agents.
Need a visa for Australia
WHV's can ONLY be applied for; before arriving in Australia. Working Holiday Visa's* can only be granted before you arrive in Australia. For details about applying visit Australia's official website here (www.immi.gov.au) or visit a Travel Agent or an Australian Embassy or Consulate in the country you are in.
If your monthly wage is more than $A450, your employer must contribute an additional sum equal to 9.5% of your wage into a superannuation (pension) account for you. If you entered Australia on an eligible temporary resident visa you can, in most cases, access your contributions when you leave Australia, although the contributions will be taxed.