The Tourism & Transport Forum Australia (TTF) has welcomed the common sense support of Federal Labor in opposing the Federal Government’s plan to increase the holiday tax – the Passenger Movement Charge – to $60 from 1 July 2017.

TTF tabled an economic analysis by KPMG in the Senate Inquiry that shows the proposed increase in the holiday tax is completely unnecessary to fund the $540 million revenue target set by the Federal Government – the modified backpacker tax rate will more than cover the amount.

“The Federal Government should never have included an increase in the holiday tax as part of its revised backpacker tax package. The analysis by KPMG commissioned by TTF has shown that it is completely unnecessary to compensate for any cut in the backpacker tax rate,” said TTF CEO Margy Osmond.

“The tourism industry welcomes the support of Federal Labor in encouraging the Government to abandon its ill-considered plan to increase the cost of travel to Australia.

“The holiday tax already raises $1 billion a year for the Federal Government and it’s growing on its own, it doesn’t need to be increased further.

“The Government has tried to dismiss the hike in the holiday tax as ‘just a cup of coffee.’ It’s not a cup of coffee, it will be a $60 tax per person or $240 for a family of four (over 12 yrs) – that is another night’s accommodation, entry to a museum or theme park or a couple of days car hire.

“It’s time for all parties involved to come to a fair compromise on the backpacker tax that does not include a completely unnecessary increase in the Passenger Movement Charge. Tourism will no longer stand to be treated as a ‘cash cow’ by any Government or political party.”