Backpacker tax on the Government backburner

The Government has deferred the introduction of the so-called "backpacker tax" to 1 January 2017 pending a review of issues surrounding working holiday makers in Australia.

The Assistant Treasurer announced on 17 May 2016 that the Government will undertake a review of the broad range of issues affecting the supply and taxation of working holiday maker 417 and 462 visas. To provide for further consideration of these issues, the Commonwealth will defer the commencement of the previously announced tax changes [commonly referred to as the "backpacker tax"] to treat all working holiday makers as non-residents for tax purposes from 1 July 2016 for 6 months, pending the outcome of the review process, she said. [The so-called "backpacker tax" is the Government's 2015-16 Budget proposal to remove the tax-free threshold for overseas working holidaymakers in Australia with effect from 1 July 2016.]

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