RACGP applauds LNP commitment to stop Patient Tax

The Royal Australian College of GPs (RACGP) has applauded the Liberal National Party of Queensland (LNP) for committing to exempt GPs from payroll tax and is urging other parties to match the election commitment. 

The Sunday Mail today reported that the LNP has committed to exempt GPs from payroll tax if elected. 

RACGP Queensland immediate past Chair Dr Bruce Willett said: “I applaud this commitment from the LNP – it recognises the critical importance of access to affordable general practice care for all Queenslanders. 

“There is no substitute for the quality care you get from a GP who knows you. General practice care helps people stay healthy and out of hospital, and it reduces pressure on our health system. 

“Queensland was the first state to act and issue new Revenue Office ruling after the RACGP warned that a new interpretation of payroll tax risked widespread practice bankruptcies, and higher out-of-pocket costs for patients. 

“General practices run on very thin margins. Our surveys found just 3% of practices could absorb the costs of payroll tax on independent GPs, the rest would have to pass on the costs to patients. 

“The LNP’s commitment to exempt GPs from payroll tax is an important step to keeping essential healthcare affordable, and practices viable. Access to affordable GP care is essential for healthy communities, and for the future of Queensland.” 

Background 

Practices in Australia have always paid payroll tax on their employees, including receptionists and nurses, but it never applied to GPs because they work independently. This changed after a final ruling by the NSW Court of Appeal in 2023 deemed independent practitioners as employees for payroll tax purposes.   

Queensland was the first state to listen to the RACGP and provide an amnesty to prevent practices going bankrupt due to retrospective tax. It was also the first state to issue new Revenue Office ruling that patients’ fees paid directly to a GP for that GP’s services will not be subject to payroll tax.