Anthony Albanese (Grayndler, Australian Labor Party, Shadow Minister for Infrastructure and Transport) Share this | Hansard source

At that stage it was the backpacker tax. That was before the backtracking that occurred on the backpacker tax. It is the case that this is policymaking that would suit Dr Seuss, frankly, in the way that it has been done. They announced it with fanfare: they were geniuses! But they had not consulted the farming sector and they had not consulted the tourism sector, so they did not bring any legislation. It was still there. So what happened was that backpackers and young people in Europe, Asia, the United States and Canada were getting information, via their newfangled smartphones and the internet, about this whack that was coming on in terms of taxation arrangements and we saw dropping numbers of backpackers visiting Australia.

During the election campaign, having gone through the 2016 budget, the government decided that they would defer the implementation of this tax. Some 18 months later they finally introduced the legislation. There were 18 months of uncertainty for the agricultural and tourism sectors. They then resisted the Senate inquiry to consult people about processes. When they did that they said that it was urgent. After having waited 18 months all of a sudden it was urgent. At that inquiry the agricultural and tourism sectors put forward the argument that this tax was not in the interests of those sectors and not in the interests of the economy.

We have had these absurd arguments. The first absurd argument we have had only in the last few days is that somehow this was something to do with a decision by former Treasurer the member for Lilley. That is just a farce. The budget papers show that backpackers indeed were paying zero tax. In 2015 Treasurer Joe Hockey said that he was introducing this new measure to raise additional money. That was the point of it. It was going from zero to 32.5 per cent. We hear people like the member for Riverina say, 'We had to oppose the 32.5 per cent,' but it was their idea, their initiative. They then decided that they would change it to 19 per cent. They had no economic modelling but said it would raise less additional revenue—again them acknowledging that this began in 2015.

In order to make up for what they saw as a shortfall of this short-sighted policy they said that they would change the super arrangements so that 95c in every dollar would go straight back to the government. That was a tax not on backpackers; that was a tax on employers, which would go straight into government coffers. The change they are making here now belatedly is to 65c in the dollar, at a cost to the budget of $55 million over just three years.

They then introduced the passenger movement charge—a $5 increase. They had the same process that they had for the backpacker tax before it became the backtracker tax: they rang the major airlines on the day that the announcement appeared in the paper to let them know, just in case they did not have access to the internet at Qantas, Virgin and other major airlines. So you had this $5 charge being put in that was totally unrelated. So the agricultural sector was being hit but the tourism sector was being hit twice. It was being hit with fewer backpackers coming here, backpackers who largely work in regional Australia and who bring more money than they earn and who spend it in the communities where they are working. That is what they do.

Now we have had in the last 24 hours the Prime Minister, the Treasurer and the Deputy Prime Minister actually insult people from Germany and France who come here to make a contribution. What sort of idiocy is that? 'We do not want rich backpackers coming here from Germany and France'—completely absurd. People who come here make a contribution and spend more money than they earn here. And, what is more, when they come back with their families in a few years time they will stay not at the hostel but at the Hilton and they will spend even more money. And when they go back to Germany and France and that region, the whole time they are showing people the photos of their experiences in Cairns, Broome, Mount Isa or Gladstone—

Ms McGowan interjecting—

Or in the electorate of Indi. They become advocates for Australian tourism, and they create jobs.

But then, because they lost the vote in the Senate on the Passenger Movement Charge Amendment Bill 2016 on Wednesday night, on Thursday as the bells were ringing they went into the chamber and handed the One Nation senators a draft amendment that they had had done up for a five-year freeze that we know from a ruling from the Speaker of the House of Representatives just this week is not worth anything at all. We are a sovereign parliament, and we are talking about a tax increase that in July the government promised not to do. They promised a freeze for this term, as we did, because we know that it is counterproductive tax. At the end of the day, if you discourage people from coming to Australia, if you discourage that economic activity, you end up in a worse fiscal position. It is counterproductive. So you have that, but it is worse. It is not just that they promised it at the election. After this election, unlike after the 2013 election where they forgot to appoint a tourism minister, at least they did appoint a tourism minister. He stood at the dispatch box and said that increases to the passenger movement charge would choke the golden goose that is the tourism industry. That is what he said two weeks before the government announced this tax increase. He was not even consulted about the decision that was made. He was on his way to the Middle East when the cabinet made this decision. The five-year freeze is a farce and the senators in the other place were conned on that issue.

Then you had the announcement of a so-called deal—it was all done days ago—for a 15 per cent backpacker tax. So the 'backtracker' tax had gone from 32.5 per cent to 19 per cent and then down to 15 per cent. This time they were really serious. There were to be no more negotiations. Victory was had. 'Mission accomplished,' said the Treasurer. And yet today we have a complete failure of leadership. So obsessed are those opposite with not being cooperative with the other major political party, the Australian Labor Party, that they prefer to enter into an arrangement that costs the budget $155 million, when we had said we that we would cop 13 per cent because that aligns with the withholding tax in horticulture that applies to those Australian backpackers for whom it is unclear that they will meet the income-tax-free threshold. That $155 million is $100 million more than they would have to spend otherwise, and they are in an arrangement with the Australian Greens and One Nation. This is the mob who, with their genius strategy of the double-D election, helped recreate One Nation earlier this year. But now, instead of having an arrangement that would have minimised the differential impact on the budget, they have a $155 million hit to the budget and a Treasurer who is reduced to the humiliation of having Richard Di Natale, the leader of the Australian Greens, named on a joint release on the Treasurer's letterhead. It is completely absurd.

What we have seen with this, the whole way through, is a whole lot of misinformation. You have had the absurdity of saying that Australian workers would be taxed at a higher rate than foreign workers. This is the mob that does not seem to understand that it was Labor that tripled the income tax free threshold to $18,200, thereby taking a million Australians out of the tax system. If Australian workers earn the same as your average backpacker, guess how much tax they will pay? Zero; not a dollar. And yet, those opposite have continued to engage in this misinformation. This has been absolute chaos from the government. They have had at least five positions in the last month, after having had one position for 18 months that has caused distress and concern in the agriculture and tourism sectors. This government should stand condemned for this chaos.

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