The 15 per cent rate came after a long and drawn-out political fight, which ultimately saw a compromise deal between the Coalition and the Greens. From 1 January 2017, all backpackers will pay 15 cents income tax from the first dollar they earn.
The government had previously said the tax rate for nonresidents of 32.5 per cent would apply from 1 January unless its bills passed through Parliament. “But in fact the 32.5 per cent rate is the common law rate right now,” the ABC wrote.
“The whole fight Australia has been having over the last 18 months was actually about enforcing the existing tax law, as interpreted by an Administrative Appeals Tribunal ruling back in March last year.” In other words, if you’re a backpacker and earned income in the first half of the financial year — before 1 January 2017 — you will have to pay the 32.5 per cent rate on that income.
So if you are a backpacker, and you have been working in the Southern Downs Region, or for that matter anywhere in Australia this season, you may want to be certain of your rights with Australian Income Tax.
You can contact the Australian Taxation Office HERE, or ask your employer for more information.