The Royal Australian College of General Practitioners (RACGP) and Australian Medical Association (AMA) have joined forces to urge the Australian Capital Territory Government to respond to local GPs concerns about payroll tax.
After recent meetings with the ACT Revenue Office failed to allay the concerns, the AMA and RACGP are seeking further meetings with territory politicians of all political colours to make sure the government adequately responds to the issue in Parliament by August 31.
GPs became concerned after recent court judgements in New South Wales considered GPs at certain medical practices as employees for payroll tax purposes. South Australia and Queensland announced amnesty periods after the RACGP and AMA pointed out that any extra tax burden on general practices would force them to raise fees or close.
Practices in Australia already pay payroll tax on their employees, including receptionists, registrars, and nurses. But it hasn’t applied to GPs because most doctors are not employees – they lease rooms from a practice owner and operate under independent agreements. A poll of practices across Australia found only 3% would be able to absorb the costs associated if GPs were considered employees for payroll tax purposes – 78% would be forced to raise fees.
RACGP NSW/ACT Chair Professor Charlotte Hespe urged ACT’s leaders to give local GPs surety on payroll tax to ensure ongoing access to GP care for Canberrans.
“Access to GP care is essential – it’s what keeps people healthy, and out of hospital, at all stages of life,” she said.
“But most practices today operate on very thin margins. If they suddenly face an extra payroll tax bill of hundreds of thousands of dollars, they’ll be forced to pass the costs on to their patients, or they will have to close. It could also deter GPs from practising in the ACT at a time when we need to grow the workforce – demand for GPs in the ACT is forecast to increase 65% by 2023.
“This would be a complete disaster for the ACT. Canberrans already struggle with Australia’s lowest rates of bulk billing, and highest out-of-pocket costs for care. This affects people on low incomes the most and puts pressure on hospitals.
“ACT’s political leaders need to put the health of their citizens first and give surety to local GPs on this issue, before it’s too late and we see any more practices close.
Dr Kerrie Aust, AMA ACT President Elect said: “Some patients already struggle to see a GP in the ACT and we’re concerned that the ACT Government’s moves on payroll tax will make that worse, possibly pushing some GPs out of business.
“It’s incredibly frustrating to have the Federal Government supporting GPs through the recent Federal Budget and then see the ACT Government effectively undercutting that support.”
