Australia slashes ‘backpacker tax’ after widespread outcry

Australia watered down plans for a “backpacker tax” on foreigners on working holidays on Tuesday, after an outcry from farmers and tourism operators.

Canberra had been under increasing pressure to shelve the tax – 32.5 cents (26 US cents) for every dollar earned – amid fears it would deter tourists from choosing the country as a destination.

Some 600,000 backpackers travel to Australia every year, many of them finding work picking fruit, and farmers had complained bitterly that the tax could affect labour supply at harvest time.

“We recognise absolutely the important part that backpackers play in the overall tourism industry,”

Treasurer Scott Morrison told reporters in Canberra.