The federal government has proposed a 32.5 per cent tax on overseas backpackers who wish to work in Australia to continue their travels.

Mayor of Narromine Council, Bill McAnally is worried farmers who require workers during cotton picking and the grain harvest will be the most affected by the tax.

"Over the last four or five years backpackers have been our workforce out here for harvest and cotton picking," he said.

"This would discourage a lot of them coming out here, they're already on a shoestring budget as they want to get around Australia."

The National Farmers Federation shares Cr McAnally's concern.

"The agriculture industry relies on backpackers to fill severe labour shortages which are often seasonal and temporary, for example when crops are being harvested or milk production is at its peak," NFF Workforce Productivity Committee chair Charlie Armstrong said.

"Each year backpackers contribute around $3.5 billion to the Australian economy and around 40,000 find employment on Australian farms."

The NFF believes backpackers should be taxed, but 32.5 per cent is far too high, believing 19 per cent is fairer.

"Taxing backpackers at a rate of 32.5 per cent will make work in Australian agriculture a highly unprofitable proposition. Furthermore it will lead to a reduced agriculture productivity and will strip regional communities and businesses of much-needed tourism spending," Mr Armstrong said.

"What's the point of increasing revenue through the implementation of this tax only to strip back the contribution of agriculture, tourism and regional spending to the economy."

Cr McAnally fears the seasonal positions will not be able to be filled should backpackers stop visiting the region.

"It's hard to fill the positions locally. A lot of the farmers don't have employees on staff these days, they rely on casual labour,'' hesaid.

"The government should be looking at cutting costs somewhere else. They should consider it's hard out here to attract workers, especially seasonal workers."

Mr Armstrong is encouraging everyone to sign an NFF petition to demonstrate how many people the tax could negatively impact.

"We urge farmers and other industry stakeholders as well as the broader public to join us in demonstrating the importance of backpackers to agriculture, tourism and the regions by signing theonline petition," Mr Armstrong said.

The petition can be found at change.org titled Australian Government Stop the Backpacker Tax

Would the introduction of the backpacker tax impact you?

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