RACGP welcomes strong election commitments from parties, but renews warning on payroll tax

The Royal Australian College of GPs (RACGP) has applauded strong health election commitments from the major parties in Tasmania, but warned Tasmania’s GPs must have certainty on payroll tax. 

Major and minor parties have been highly receptive to recommendations in the RACGP Tasmania’s budget submission, which requested funding for rural and regional GP training, expanded funding for vaccines for meningococcal B and influenza, a dedicated mother and baby unit to support families with early intervention for perinatal issues, and reimbursement for GPs advising the Tasmanian Government.

Tasmanian Labor has committed to resolve payroll tax concerns in its first 100 days in government. This tax has threatened the viability of practices under a new interpretation of tax law, which threatens to count independent contractor GPs as employees for tax purposes. The party has also announced it will fund qualified overseas-trained doctors to train as GPs in Tasmania, providing a significant incentive for these doctors to move to the state and join its future GP workforce, fund 50 GPs undertake emergency care training, supported GPs to co-prescribe for patients with attention-deficit/hyperactivity disorder (ADHD), and committed to funding for mother and baby units.

The RACGP called the Tasmanian Liberals’ plan to pay up to $100,000 of HECS student debt for up to 40 GPs who work in the state’s rural and regional areas a “smart investment”, and welcomed their funding commitment for mother and baby units. The party has also announced plans provide multi-year funding of up to $250,000 annually as flexible grants to sustain general practices and to amend the Poisons Act to allow GPs to prescribe stimulants independently for patients with ADHD and fund two GPs with a special interest in ADHD.

The Tasmanian Greens have committed to not imposing payroll tax on GPs working under independent agreements. The party has also said they support the College’s call to fund overseas-qualified doctors to train as GPs in rural and regional areas and mother and baby units, and heeded the RACGP’s calls to fund meningococcal B vaccination for to babies and adolescents and to roll out a state-wide RSV immunisation program for infants.

Tasmania Chair Dr Toby Gardner said both parties had committed to important funding requests from the College’s Tasmania budget submission,

“We applaud all parties for their strong commitments to ensuring Tasmanians can access a GP,” he said.

“The parties have come to the table with us and committed to important measures that will help to rebuild Tasmania’s general practice workforce and all parties have shown they appreciate there’s no substitute for a GP.”

Dr Gardner said however that GPs need for true clarity on payroll tax from all parties.

“Unfortunately, payroll tax is an enormous source of angst in the GP profession as it upends our model,” he said.

“The payroll tax question has hung over the GP profession for two years, and I know of practices that have spent tens of thousands of dollars on lawyers and tax advisors seeking clarity on if the tax applies or not.

“Around 90% of GPs work as independent contractors rather than employees. They rent rooms and services from a practice including use of its nurses and administrative staff, who are classed as employees, and fund their own leave and superannuation, as contractors do. Our fees are set on that basis, and most practices have profit margins that are below Tasmania’s payroll tax rates.

“We appreciate that Premier Rockliff has said ‘we’re not making any changes to current circumstances’ to payroll tax, but unfortunately, on the mainland ‘no change’ has come to mean that practices will be charged payroll tax on independent GPs. 

“That line is what mainland premiers and treasurers say when changes to payroll tax are in fact going ahead. That’s what the government in Victoria has told GPs – that there ‘has been no change to the way payroll tax is assessed or enforced’ for GPs at the same time as practices have received tax bills backdated to before this a factor. My colleagues in South Australia have heard a similar claims, and last year, before they developed a solution for payroll tax, Queensland Treasury used the same line to claim new tax obligations were just business as usual.

“We need certainty. GPs want a clear and unambiguous message that the Premier will stand with Tasmanian Labor and the Tasmanian Greens in giving practices and their communities certainty about their future.

“Whatever the results are on Saturday, we look forward to working with Tasmania’s government to implement their agenda and secure a healthy future for our patients.”

~ENDS

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