Irish company to sue Australia over ‘backpacker tax’

A tax refund company based in Kilkenny has launched legal action against the Australian government over the country’s backpacker tax.

Taxback.com claims that the tax rate introduced in January for working holiday visa holders (417 and 462) breaches tax treaties that Australia has signed with eight countries, including the UK.

Eileen Devereux, commercial director at Taxback.com, said: “Having lodged our pre-action letter, we have been extremely encouraged by the willingness of the Australian Government to come to the table for talks. It is our preference to resolve this issue through a mediated solution and we look forward to collaborating on this.

“Our starting point is that by discriminating against foreign workers the tax is fatally flawed. The tax unfairly targets working holidaymakers. It runs in direct conflict with Australia’s obligations under multiple international tax agreements. In doing so, it also harms the reputation of Australia’s tourism sector.

“There’s no doubt that the backpacker tax has left a sour taste in the mouths of many visitors, and that can only harm Australia’s ability to attract visitors in future. This is why we are asking the Australian Government to reconsider its position on this matter.”

Ms Devereux joined Taxback.com at its Kilkenny office but is now based in the international firm’s Sydney office.

She said Ireland is not one of the eight countries which Taxback.com believes cannot be legally included in the backpacker tax.

However, she added: “We would be hopeful that if the case were successful for the eight countries in question that the Australian Government would extend this to the additional nationalities who avail of the 417 and 462 visa programs.”