Treasurer wrong on payroll tax

Treasurer Cameron Dick’s claims in Budget Estimates that his decision to impose payroll tax on general practices for tenant GPs will only affect big corporate medical practices shows a misunderstanding of how this new tax will work.

“The vast majority of practices targeted for auditing under the new interpretation of payroll tax law are not large corporates – they are small suburban and regional clinics, owned by mums and dads,” AMA Queensland President Dr Maria Boulton, a GP and practice owner, said.

“This tax will hurt patients, particularly those in nursing homes. Most GPs who visit patients in aged care facilities actually lose money to do so, as the Medicare rebate doesn’t cover the cost of the patient’s care. This new tax will just make it worse, as practices won’t be able to absorb the extra cost and will have to pass it on patients.

“General practice is already on the ropes after decades of neglect by both sides of politics and all levels of government. We are seeing practices close almost every week in Queensland, leaving communities without their trusted family doctor.

“Practices cannot afford this new tax. Their only options are to pass it on to patients or close their doors.

“While we appreciate the Queensland government’s decision to halt auditing and hold off imposing this new tax until 2025, we note the West Australian government has already ruled out applying payroll tax to general practice.

“The Treasurer’s claim that scrapping this tax would lead to $100 million in cuts to other services does not stand up, as it is not currently being collected.

“We urge the Treasurer to consider following his WA Labor colleagues in their sensible decision not to impose an unprecedented extra cost to patients at a time when cost of living pressures are hitting communities hard.

“The Under-Treasurer confirmed today that 93 general practices have applied for the amnesty since February. There are approximately 1,400 general practices in Queensland. Many of them have been holding off on applying for the amnesty while they wait for legal and accounting advice.

“General practices pay payroll tax for administrative staff, nurses, receptionists and other employees. But the vast majority of GPs work in practices as tenants, effectively renting space and administrative support. They are not employees.

“This is not about giving anyone a tax break. This is just about applying the law as it has stood for decades.”