Backpacker Tax Illegal Means You Can Ask For Refund

Backpacker Tax Illegal Means You Can Ask For Refund

31/10/2019 0 By M Zaman

Australia is one of the most spectacular to visit on earth. Most recently the country’s Federal Court announces backpacker tax in the country is unlawful. This means you are eligible to ask for a refund.

Generally, a backpacker tax is only applicable to a person who has temporary relocated to Australia on different Working Holiday Visas.

Australia has treaties with the UK, US, Germany, Finland, Chile, Japan, Norway and Turkey. This treaty allow to recruit workers from these countries.

There are about 150,000 foreign workers come to Australia on Working holiday Visas. Among, many of them are working in agriculture and hospitality industry.

However, there are discriminatory tax evidences between an Australian Citizen and workers who are already in Australia on a Working Holiday visa.

Australia Kangaroo Outback, Australia

Australia Kangaroo Outback, Australia (Image: Pixabay)

For an instance a tax contributor who is on a Working Holiday visas on subclass 417 or 462 earn about A$37,000/£53,474 (1 AUD = 0.691925 USD) in a year. Then, eligible to pay 15% of taxes or A$5,550/£8021 income tax.

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Where as , an Australian resident or citizen earn A$37,000/£53,474 in a year, will get first A$18,200/£26,306 income tax-free. But, they are still eligible to paying for 19% of income tax. There are also a medical levy and a low income tax credit. Altogether, there are eligible to pay A$3,867/£5590 in taxes.

This also clearly a serious breach of double taxation treaty and most controversial in its history.

In a decision judge John Logan added “That is a disguised form of discrimination based on nationality”.

He also added “It is but a more particular variant of the disguised discrimination example given in the OECD commentaries”.

Most iconic Sydney Opera House, Sydney, Australia

Most iconic Sydney Opera House, Sydney, Australia (Image: Pixabay)

The original case brought to the court by Ms Catherine Addy a British citizen who was in Australia on Working Holiday visa.

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Meanwhile, ABC Australia reports, Australian Taxation Office or ATO is considering further steps to appeal against the decision.

Australian government forbids to climb at the top of Uluru rock. As, it is symbolic and the most sacred place among indegenious Australians.

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