James Pearson, CEO of the Australian Chamber, said:
"The tourism, hospitality, and farming industries have been uncertain about what would happen after July 1 when the tax free threshold for people on Working Holiday visas was due to be abolished.
"The delay and, we strongly hope, the eventual abolition of the backpacker tax is a key issue for regional tourism and for business.
"Just one in twenty people working in tourism are on a Working Holiday visa, but they make an important contribution to regional economies and at the national level.
"Working Holiday makers do jobs that otherwise would not get done. They keep open the doors of tourism businesses – particularly in regional Australia.
"The backpacker tax focussed on revenue-raising. Its design didn't take into account that most of the money that working holiday makers earn, and often a good chunk of their savings, is spent in the local communities in which they are employed.
"Most importantly, working holiday makers provide valuable services to tourism, hospitality and agricultural businesses in towns struggling with skills shortages.
"The Government itself has identified a serious shortfall in skilled employees for tourism.
"This is a shortfall that is best tackled with better training and retention of locals but it is important to recognise those overseas visitors who spend a significant part of their break working in Australia, getting to know our culture and becoming life-long friends.
"Tourism is an export success story at a time when trade surpluses are in short supply.
"In an economy facing the dual challenges of a large budget and trade deficit, we must value the $1.5 billion surplus tourism related services have contributed to the last two months trade figures.
"This is an industry that also produces more than $8 billion in revenue for the economy along with around one million jobs.
"The announcement by the government to delay the introduction of the tax is a sign that the Government recognises the importance of regional economies and is serious about supporting and strengthening the booming tourism industry.
"I acknowledge the efforts of business advocacy groups, particularly the National Farmers' Federation, and the Australian Chamber's National Tourism Council, to encourage the Government to re-think."
