NSW opposition backs payroll tax relief

3 minute read

The Liberal Party will move an amendment this week to make all healthcare businesses exempt going five years back and two forward.

NSW Shadow Treasurer Damien Tudehope has confirmed the state opposition will attempt to secure a payroll tax exemption for healthcare when parliament sits later this week.

It comes just over a week after the state revenue office released a ruling outlining its position on payroll tax and news broke that one general practice in the Northern Rivers area had been hit with a $450k retrospective tax bill.

The potential solution that Mr Tudehope is proposing would be similar to the amnesty concessions made by Queensland and South Australia in that the tax office would not be able to retrospectively audit practices.

The exemption itself would be a temporary solution, only in place for two years, but also rule out back taxes.  

“Retrospective audits leading to demands for payments of payroll tax covering five years of operation are creating a crisis for these clinics that must be addressed,” Mr Tudehope said.

“The best solution to this urgent problem is to provide an amnesty from all such payroll tax for the past five years and an exemption for the next two years while a satisfactory solution is found.”

It’s unclear whether practices would have to apply for the exemption, like in the amnesty states, or whether it would be automatic across the board.

The opposition currently hold 39% of the seats in the Assembly compared to Labor’s 48%, but do have an equal number of seats in the Legislative Council.

NSW won’t go to its next election until 2027.

RACGP president Dr Nicole Higgins nonetheless welcomed Mr Tudehope’s commitment.

“Politicians of all stripes need to get on the same page and fix this before it’s too late,” she said.

“We’ve already lost too many practices in NSW due to the decades of underfunding of general practice care.

“If we lose any more due to this new state tax grab, it will be devastating for the patients and communities affected, and it will put even more pressure on hospitals and ambulances.”

So far, the NSW Labor government has not given any indication that it will consider implementing a payroll tax amnesty or exemption for GPs.

The RACGP, AMA and Australian GP Alliance co-signed a letter to the NSW and Victorian governments calling for an exemption last week.

“We need a national solution to this, because it also threatens to undermine the federal Government’s investment and reforms to improve access to GP care – such as tripling bulk-billing incentives,” Dr Higgins said, echoing comments by federal Health Minister Mark Butler.

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