The bill to exempt Queensland GPs from payroll tax is working its way through the committee stage of parliament.
Queensland parliament is inching closer to signing the general practice payroll tax exemption into law, with peak bodies hoping the fever will catch.
AMA Queensland president Dr Nick Yim and RACGP Queensland chair Dr Cath Hester fronted the State Development, Infrastructure and Works Committee on Thursday to discuss the Revenue Legislation Amendment Bill 2024.
If passed, a new exemption will be added to the Payroll Tax Act 1971 providing that wages subject to payroll tax do not include wages paid or payable by a medical practice to general practitioners.
There are no minimum bulk-billing thresholds that a practice has to meet in order to qualify, and both employee GPs and contractor GPs are covered.
The government has already authorised the state revenue office to administer the exemption under an administrative arrangement backdated to 1 December 2024.
Dr Hester told the committee that, without the introduction of the exemption, her practice would have had no choice but to substantially raise patient fees.
“I hasten to add that the financially precarious nature of general practice ownership is not due to financial mismanagement, but rather rapidly increasing costs of running medical facilities and a decades’ long atrophying of the funding for general practices,” she said.
“GPs view the care they provide as a human right, not as a luxury commodity.”
Many practice owners, she added, reinvest their scant profit margins back into the business.
Related
“Payroll tax would completely obliterate this operating margin and would be a disincentive to work in this manner.”
She called for other state governments to do “everything they can” to ensure GPs across the country were able to deliver affordable primary care.
Dr Yim, meanwhile, encouraged Queensland legislators to consider expanding the tax exemption to non-GP specialists, who he said “also fear receiving retrospective liability notices”.
“Granting them an exemption would alleviate the threat [of closure] while also bringing the public and private medical sector into alignment at the same time,” he told the committee.
“All public and most private hospitals are already exempt under the Act, creating unfair competitive advantages.”
Queensland Treasury had already informed the AMA Queensland that this would be outside the scope of the Liberal National Party’s election promise to scrap payroll tax for GPs.
“It is only right that non-GP specialists are given the same certainty as all other medical entities, which is why we urged the Committee to recommend they be included in the exemption provisions in the Bill,” he said.
So far, no other state has introduced a full payroll tax exemption for GPs.