Roundup: Aussie "backpacker tax" to be halved ahead of fruit picking season

In a last-ditch effort to ensure Australia's farmers have sufficient help ahead of the fruit picking season, Australia's coalition government has agreed on a compromise which will set the nation's "backpacker tax" at 15 percent.

After a weekend of negotiations with the Senate crossbench, Treasurer Scott Morrison announced the government had accepted a 15 percent compromise, down from the current 32.5 percent tax rate.

It's expected the compromise will satisfy the crossbench, meaning the bill will pass the Senate before Parliament takes its Christmas break from Thursday.

Earlier this month, the nation's Senate committee urged parliament to pass the bill as soon as possible in order to maintain Australia's attractiveness to working holidaymakers and to secure extra harvest labor for farmers ahead of the summer season.

Australia's agriculture sector relies on the labor of backpackers, and many have argued the current rate has discouraged working holidaymakers from choosing Australia as their working holiday destination.

On Monday, the government's compromise was backed by the National Farmers' Federation (NFF) with CEO Tony Mahar urging the Senate to "expedite" the passage of the bill ahead of the fruit picking season.

"It has been a painful process but we wholeheartedly welcome the announcement that a compromise rate of 15 percent has been reached," Mahar said in a statement released on Monday.

"The NFF back to the Colbeck Review said that a rate between 15 percent and 19 percent was a fair one that would attract backpackers to the sector and be comparable with rates paid to Australian workers."

"We now ask that the Senate expedite passage of the relevant legislation to provide the long needed certainty to the sector and allow businesses to start rebuilding backpacker interest in on-farm jobs.

"In time we hope that lessons are learned so that the farm sector is never compromised in this way ever again."

Despite the government's decision to come to the table on negotiations, both the Labor opposition and the Greens have said they will maintain their hard-line position of striving for a 10.5 percent tax rate.

"The Labor party will maintain its position on the 10.5 percent," deputy Labor leader Anthony Albanese said.

Meanwhile, Greens Senator Peter Whish-Wilson said his party would be more likely to support a 15 percent tax rate if the government scraps the associated 95 percent clawback on superannuation earned by the backpackers.

"The Senate really should not be supporting this proposal on a 15 percent backpacker rate," Whish-Wilson said on Monday.

"With the 95 percent clawback on superannuation of backpackers then the effective tax rate is closer to 24 percent which is... roughly double the tax rate for backpackers in New Zealand."

"We are seeking advice on whether we can move an amendment to this new bill to cancel the superannuation clawbacks."

However, with both the government vote and the expected crossbench support, the bill is likely to pass in its 15 percent form.

Usually employed on a casual basis, backpackers help farmers pick seasonal harvests of grapes, cherries, blueberries, oranges, melons, apples and bananas, mainly in Australia's eastern states.

Without backpackers, many Australian farmers would not be able to secure sufficient help to pick enough fruit before it begins to rot. Endit