Is Australia losing its working holiday backpackers?

Many if not most backpackers who visit Australia pick up work along the way to fund and supplement their trip.  A proposed tax increase could result in backpackers paying out one third of all money earned while touring the country. Will this tax drive these travelers to other destinations?

Backpackers already turning off Australia as tax hike looms

The latest International Visitor Survey by Tourism Research Australia showed a seven per cent fall in the time backpackers spent down under.

The downturn is in stark contrast to other overseas visitors who increased more than 10 per cent in the year to June 30, and racked up 5 per cent more nights in Australia.

Tourism industry leaders were quick to blame the looming “backpacker tax” for the result and again urged the Federal Government to scrap the proposed change — due to take effect at the start of next year.

Under the change, people on Working Holiday visas will be taxed at a rate of 32.5 cents in every dollar earned, as opposed to current arrangements which see them taxed at about 19 cents in the dollar after they earn more than $18,000.

Backpackers on working holiday visas tend to pick up hard-to-fill jobs like fruit picking.  They also pump a considerable amount of money into the local and national economies over the length of their trip. The article suggest that Australia could lose as much as 60% of the working holiday makers following the tax hike.  

What do the Australian hostel operators in this forum think about this? Is the situation as dire as it sounds, or is this just political rhetoric intended to push an agenda on the tax issue?  Are there other trends to consider besides the tax issue?  How are your numbers this year compared to previous years, and what are you predicting for next year?