The woman had worked as a waitress in Sydney (Stock image)
(Picture: AFP via Getty Images)A British woman who worked as a waiter in Sydney has won a legal battle against Australia’s “backpacker tax” in the country’s High Court.
Catherine Addy claimed she had been unfairly taxed on the pay she earned between August 2015 and May 2017 on the basis of her nationality.
Under Australian law, anyone on a working holiday visa must pay a 15 per cent tax on the money they earn up to £20,000. Meanwhile, Australian citizens get a tax-free threshold of £9,938.
Lawyers for Ms Addy had argued the rules – dubbed a “backpacker tax” – contravened a “double taxation” agreement Australia has with the UK.
This requires British citizens to be taxed equally to Australian nationals “in the same circumstances, in particular to residence”.
In a judgment handed down on Wednesday, the High Court of Australia said: “The question is whether that more burdensome taxation was imposed on Ms Addy owing to her nationality. The short answer is ‘yes’.
“Ms Addy’s circumstances in the 2017 income year including that of her residency in Australia for taxation purposes were relevantly the same as an Australian national.
“She did the same kind of work and earned the same amount of income from the same source; yet an Australian national was required… to pay less tax.”
Taxback.com – which helped Ms Addy bring the case – told the BBC that the tax had been viewed as a “disincentive to working holiday-makers to take up much-needed seasonal picking work while visiting Australia”.
The ruling could pave the way for the thousands of British backpackers who have worked on the 417 visa – which is offered to foreigners aged between 18 and 31 - to seek claims.
It follows a long-running legal battle between Ms Addy and the Australian tax authorities.
In 2019, a Brisbane court ruled that the “backpacker tax” could not be applied to Ms Addy as a result of the treaty between Australia and the UK.
However, the decision was overturned by the Federal Court, before Ms Addy’s lawyers appealed to the country’s highest court.
