Finder makes money from featured partners, but editorial opinions are our own.

Australia’s backpacker tax delayed six months


Working holidaymakers won’t be hit with higher taxes just yet.

The Coalition government’s backpacker tax, announced in the 2015-16 Federal Budget, has been delayed until next year.

The changes, now effective 1 January 2017, will see working holidaymakers taxed at a rate of 32.5% on all earnings from 1 July this year.

Currently, international travellers working in Australia are only taxed when their income exceeds the $18,200 tax threshold. They are then taxed at a rate of 19c on the dollar, up to $37,000.

The majority of individuals affected by the proposed change would be travellers involved in Australia’s “Working Holiday Maker Program”. These are travellers, aged between 18 and 30, intending to work in Australia while on an extended holiday.

Working holidaymakers are also subject to a higher tax rate than residents when they withdraw their accumulated superannuation. The tax rate is between 38% and 47% for non-residents, while residents are charged 20%.

A higher tax rate may cause backpackers to seek work in other countries, such as New Zealand or Canada.

In New Zealand, working holidaymakers are taxed at a rate of 10.5% on the dollar, up to $14,000, and 17.5% on earnings between $14,001 and $48,000.

Assistant Treasurer Kelly O'Dwyer has also called for a government review of working holiday visas to assess the agricultural sector more broadly.

The outcomes of the review will be considered by Cabinet in October or November this year.

Picture: urosr /

Get more from Finder

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and 6. Finder Group Privacy & Cookies Policy.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
Go to site