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Fruit prices will spike, growers warn

AAP logoAAP 15/09/2016

Australians are being warned they'll be paying a lot more for fruit and veggies thanks to a controversial tax on backpackers.

Growers say just how much depends on the kilos of unpicked produce left rotting because pickers have abandoned Australia as a tourism destination.

Farmers are up in arms against a federal government proposal for a 32.5 per cent rate for working holiday visa tourists, concerned it will deter the backpackers they need for seasonal picking.

Fruit Growers Tasmania says it will affect not just tourism and agriculture but also hit consumers' hip pockets.

"How long is a piece of string - it will be very hard to predict," Phil Pyke told AAP on Thursday.

Mr Pyke was among a group of Tasmanian producers and industry representatives who went with the National Farmers' Federation to federal parliament to warn the government of the damage the proposed tax was causing.

He says growers are already seeing a massive decline in labour inquiries.

"An apricot grower said to me, 'by this time we'd have several hundred inquiries -we're lucky to have had 20'.

"Farmers are terrified - they are worried."

Mr Pyke warned the government the "mess" was burning bridges with its agricultural support base.

Meanwhile, coalition MPs are searching for a compromise after the government changed its superannuation policy.

Liberal Tony Pasin told a joint party room meeting he looked forward to seeing the same effort over the super compromise being applied to the backpacker tax, the ABC reports.

Tasmanian senator Jacqui Lambie said even if the tax was lowered, it would have to be less than competitive countries such as New Zealand with 10.5 per cent.

She wants the government's amnesty period extended beyond January 1, 2017.

"The prime minister needs to show leadership and say we're going to leave it this summer," she told AAP.

The government says it's considering all concerns including workforce shortages.

"We're looking at this issue very, very carefully," Financial Services Minister Kelly O'Dwyer told ABC radio.

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