RACGP welcomes Labor payroll tax commitment to GPs

The Royal Australian College of GPs (RACGP) welcomes the commitment today that under a Tasmanian Labor Government, GPs will have certainty that they will not be subject to payroll tax. 

While general practices pay payroll tax on their employees’ wages, including receptionists, GPs in training and nurses, it has never applied to GPs because they work under independent agreements – they are not employees. But a new interpretation of tax law deemed independent practitioners as employees for payroll tax purposes after court cases in the eastern states.  

This has led to some states and territories targeting practices for extra payroll tax, including retrospective tax, which is threatening widespread practice closures, and some practices having to raise patients’ out-of-pocket fees to cover the costs. 

RACGP Tasmania Chair Dr Toby Gardner thanked the Tasmanian Labor Party for listening to the RACGP. 

“I want to thank the Tasmanian Labor Party, particularly Leader of the Opposition Rebecca White and Shadow Minister for Health Anita Dow, for listening to our warnings about the new interpretation of payroll tax law, which threatens access to general practice care in many states and territories, and acting so quickly,” he said. 

“The commitment to a full exemption for payroll tax and no retrospective tax collection for independent GPs, who rent rooms from a practice owner, is exactly what Tasmania needs, and what we called for. This will ensure practices don’t have to increase patient fees, and it will prevent bankruptcies and practice closures – which Tasmania cannot afford. 

“It will ensure Tasmanians have ongoing access to the care they need to stay healthy and out of hospital.  

“And it will boost the GP workforce in Tasmania by providing certainty of the future viability of practices in our state. This will no doubt make Tasmania an attractive home for GPs affected by the payroll tax grab in other states and territories. 

"I call on all other parties to match the commitment Labor has made. It’s an easy and effective way to strengthen Tasmania’s health system and ensure Tasmanians have ongoing access to the care they need.” 

~ENDS