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Medical Health Aged Care

“No patients should miss out”: GPs call for urgent action on payroll tax hit

Royal Australian College of GPs 3 mins read

The Royal Australia College of GPs (RACGP) is calling on all state and territory governments to save the future of general practice care so that no patients miss out.

It comes ahead of the College’s annual Practice Owner’s National Conference in Cairns running 24 to 26 May. This year’s conference includes a presentation entitled Empowering Practices Through Payroll Tax: Reflecting, Positioning, and Advancing. Conducted by Senior Associate Ben Ryan and former RACGP Vice President and Queensland Chair, Dr Bruce Willett, the session focusses on the challenges posed by this payroll tax hit, the achievements of the College so far fighting for a fair go, and what will come next.

RACGP President, Dr Nicole Higgins, said that time was running out.

“This tax hit threatens to kill off affordable patient care,” she said.

“Unless urgent action is taken across the country, practices will be forced to hike patient fees or close their doors, and some patients will be left out in the cold with little choice but to turn up to an emergency department. So, we need action in every jurisdiction, no patients should miss out.

“The good news is that following strong advocacy from the College – we are achieving some momentum. Yesterday, we welcomed Victorian Treasurer Tim Pallas announcing retrospective relief for GPs on payroll tax that will help practices stay open and care for patients in need. The South Australian Government has also announced a payroll tax exemption for bulk-billed GP wages that will apply from 1 July this year to all practices liable for the tax hit.

My home state of Queensland is also leading the way on addressing this tax. The Queensland Government issued a new payroll tax ruling, clarifying that patient fees paid directly to a GP for their services will not be subject to payroll tax. Unless all jurisdictions follow suit and commit to stop squeezing practices for backdated tax – this will cause widespread closures.

“The 2023 Federal Budget, unlike this year’s disappointing version, featured vital funding to boost general practice care, including a tripling of bulk-billing incentives for certain patient groups. As Minister for Health and Aged Care Mark Butler, and Treasurer Jim Chalmers, have warned – this groundbreaking investment will be for nothing if the states and territories don’t address the payroll tax hit. It’s a case of the giving with one hand and taking with another unless a solution is found in every jurisdiction across Australia.”

RACGP Vice President and Rural Chair, Associate Professor Michael Clements, said that no communities should miss out.

“I hold particularly grave concerns for patients in the bush,” he said.

“Outside of major cities, some communities are served by just one practice, and in more remote areas several small towns may share one practice in a regional centre.

“They are dependent on this care, so if the Patient Tax forces practices to hike patient fees or even close their doors – patients, including older people with numerous chronic conditions that have to be carefully managed, will have nowhere to turn. Their health and wellbeing will deteriorate, particularly since in rural, regional, and remote areas GPs take on a more diverse range of responsibilities in the absence of other specialists being readily available. So, it’s vital that the payroll tax hit is fixed, otherwise patients in the bush will be left out in the cold.”

RACGP Queensland Chair, Dr Cathryn Hester, agreed that accessible patient care must come first.

“No patients in any community in Queensland, or across Australia, should miss out on care from a GP they know and trust,” she said.

“It is positive news that our home state is demonstrating leadership and listening to the concerns of GPs and practice teams. However, we do need a nationally consistent approach to this disastrous tax hit because otherwise GPs will pack up and leave to another state or territory. We don’t want that happening, all patients should be able to get the care they need to stay healthy and out of hospital.

“The time to act is now, otherwise many patients will miss out, and pressure on our already under-pressure hospitals will grow and grow. We are the cost-effective engine room of the nation’s health system, and it’s high time we were treated accordingly.”


General practices pay payroll tax on their employees, including receptionists, GPs in training and nurses, but it never applied to GPs because most are not employees, they work as independent practitioners under independent agreements. The landscape changed after a final ruling by the NSW Court of Appeal in 2023 deemed independent practitioners as employees for payroll tax purposes. 

RACGP surveys found only 3% of practices would be able to absorb the costs of extra payroll tax on independent GPs, 78% would have to raise fees, and 35% would consider moving interstate for favourable payroll tax settings. 


RACGP spokespeople are available for interviews: 03 8699 0992 /

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About the RACGP

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.

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