Skip to content
Medical Health Aged Care

State tax threat to general practice care must be top priority at National Cabinet: RACGP

Royal Australian College of GPs 3 mins read

The Royal Australian College of General Practitioners (RACGP) is urging National Cabinet to agree on a nationally consistent approach to state payroll tax that ensures no general practices are forced to close and patients can access the care they need in every state and territory. 

RACGP President Dr Nicole Higgins said the need for national consistency in the application of payroll tax is urgent, and state and territory governments should follow Queensland’s approach. 

“This new extra payroll tax is one of the biggest threats to general practice care in Australia,” she said. 

The Federal Government has recognised the critical role of general practice in keeping people healthy and out of hospital, and they’re progressing important reforms to strengthen Medicare, and ensure all Australians have access to affordable GP care. 

But state and territory governments risk derailing these federal reforms by hitting practices with extra payroll tax. In many states and territories, there’s a very real risk of widespread practice closures and higher out-of-pocket fees for patients. This will mean worsening health and more pressure on state hospitals. 

The RACGP is asking state and territory governments to commit to:  

  • no retrospective collection of payroll tax liabilities  

  • clarification on what constitutes a ‘relevant contract’ 

  • a full exemption from payroll tax for independent practitioners, or an amnesty until the Federal Government finalises its health funding reforms and general practices can transition to new business models 

  • no payroll tax on patients fees/Medicare paid to their GP for their services. 

The RACGP President said: There’s an urgent need for consistency in how payroll tax is applied to independent practitioners across Australia. Practices operate on thin margins, our 2023 Health of the Nation report found four-in-five practice owners are concerned about the viability of their practice. Australia lost 184 general practices last year; we cannot afford to lose more. 

Only Queensland has provided a new payroll tax ruling, clarifying that patients' fees paid directly to a GP for their services will not be subject to payroll tax. We want other governments to follow this approach. 

“But the situation is dire in other places. For example, Victoria is refusing to admit anything has changed, despite the many practice owners crying out for help because they’ve being hit with huge retrospective tax bills they cant afford to pay. 

“And just recently, in Australia’s capital, practices have received threatening letters from the ACT Revenue Office informing them they risk being audited unless they register for payroll tax. The ACT Government has shown it has no clue how general practice or bulk billing works by demanding practices bulk bill an impossibly high amount in order to receive a temporary payroll tax amnestyit's a joke at best and coercive at worst, and it will send practices broke 

“We need to sort this out urgently. The RACGP wants to work with the federal, state, and territory governments to establish a consistent approach to this tax that ensures the sustainability of general practice care Australia-wide. 

General practices Australia-wide have always paid payroll tax on their employees, including receptionists, GPs in training, managers, and nursesBut it has never applied to GPs because most work under independent agreements, they are not employees. This changed after court cases deemed independent practitioners as employees for payroll tax purposes, leading to a new interpretation of payroll tax. 

Since the court ruling, states and territories have taken different approaches to applying payroll tax to independent practitioners which has led to confusion and distress for GPs across the country. This is despite a 2010 Harmonisation Joint Protocol for payroll tax – a key mechanism to ensure a uniform approach to the application of taxation across Australia. The lack of harmonisation has resulted in practices in several states being hit with retrospective tax bills, including one for $800,000 in Victoria. 



About us:

The Royal Australian College of General Practitioners (RACGP) is the peak representative organisation for general practice, the backbone of Australia’s health system. We set the standards for general practice, facilitate lifelong learning for GPs, connect the general practice community, and advocate for better health and wellbeing for all Australians.

Visit To unsubscribe from RACGP media releases, click here.

Contact details:

John Ronan
Media Adviser

Ally Francis
Media Adviser

Stuart Winthrope
Media Officer

Contact: 03 8699

Follow us on Twitter: @RACGP and Facebook.

More from this category

  • Education Training, Medical Health Aged Care
  • 23/02/2024
  • 10:27
Charles Darwin University

New short courses to give insight into emergency and disaster health

In a time of environmental disasters and ongoing threats of disease outbreaks, a new suite of micro-credential courses will give students access to the…

  • Contains:
  • Medical Health Aged Care
  • 23/02/2024
  • 10:10
Dementia Australia

ONE WEEK TO GO until Illawarra’s Memory Walk & Jog!

With only a few sleeps to go walkers, joggers and runners are gearing up to participate in the 2024 Illawarra Memory Walk & Jog. More than 500 people have already signed-up to take part – but there’s always room for more with online registrations still open, or sign-up on the day of the event. Dementia Australia CEO Maree McCabe AM said it is fantastic to see the Illawarra community throwing their support behind Memory Walk & Jog. “As we prepare to host Memory Walk & Jog on Sunday 3 March at Wollongong's Lang Park for another successful year, we hope…

  • Contains:
  • Medical Health Aged Care, Research Development
  • 23/02/2024
  • 09:38
La Trobe University

New lead in gut health research

Wednesday February 22, 2024 La Trobe University researchers have identified a protein that is integral to gut health, providing an important lead in the search for a treatment for people with Inflammatory Bowel Disease (IBD). Research published in Communications Biology, shows for the first time that in mice, the removal of the protein BECLIN1 causes a condition with similarities to IBD. The study shows that removing BECLIN1 causes problems in the internal “trafficking” pathways of the epithelial cells which line the intestine, leading to a disruption of the protective barrier the cells create. This disruption can allow bacteria to enter…

Media Outreach made fast, easy, simple.

Feature your press release on Medianet's News Hub every time you distribute with Medianet. Pay per release or save with a subscription.