THE NSW Labor Party has warned the Clarence Valley could lose out with backpackers opting to not visit the region because of the working tourist tax announced in the latest budget.
The budget handed down last week by the Federal Government includes a tax of up to 32.5 cents in every dollar earned by working tourists.
The cost of a working holiday visa will also go up from $420 to $440.
Under the new guidelines tourists staying in Australia for more than six months can no longer utilise the tax-free threshold of $18,000.
Shadow Minister for Trade and Tourism Guy Zangari said the new taxes and charges would discourage tourists from working in Australia.
"It will make NSW less attractive to overseas visitors," he said.
"We need a strong tourism sector in NSW that encourages more travellers, not fewer.
Mr Zangari said visitors were an integral part of the NSW economy.
"This decision is proof that Mike Baird's mate Tony Abbott just doesn't understand the significant contribution overseas visitors make to our state economy," he said.
"NSW should be the most attractive place in the world to come and work and Labor will fight any action by a federal government that puts this in jeopardy."
Tourists aged between 18 and 30 with a passport for a country participating in Australia's Working Holiday Maker program can apply for a 12-month visa which lets them work in Australia.
There were 231,685 Working Holiday (subclass 417) visa applications lodged in 2013-14.
Of those 229,378 were accepted.
UK citizens represented about 20% of visa applicants, followed by Taiwanese on 13% and South Koreans on 12%.