News
Practice owner facing $5 million bill amid tax grab
It has been described as the ‘biggest existential threat to general practice’, and now a new GP-led petition is pleading for an end to Victoria’s payroll tax crisis.
GPs and practice managers at the Sia Burwood Medical Centre in Melbourne launching a new petition to scrap payroll tax.
From humble beginnings, Dr Martin Sia has worked 365 days a year to get where he is today, a GP and owner of eight medical centres across Melbourne.
But after three decades of hard work, his livelihood is now at risk.
Dr Sia is facing a retrospective bill totalling up to $5 million, as the Victoria Government ploughs ahead with its controversial payroll tax changes.
‘I should be celebrating, but after 30 years of hard work I’m very sad to be here to defend my business because of this new payroll tax,’ he said.
‘A month ago, we actually received an email from State Revenue Office demanding all these kinds of pay details going back 10 years, which is really a lot of work for us.
‘The timeframe we have [been] given is only two weeks to produce all this kind of information, and I must say with deep sadness that we have to now spend a lot of money, resources, and time trying to get a solicitor to try to get all this under control.’
As it stands, Dr Sia has been left with two options: consider closing or increase patient fees.
It is also why on Wednesday he was among a group of prominent GPs who had gathered at his Burwood practice to launch a new campaign, calling for an end to the additional payroll tax in Victoria.
The ‘Stop the patient tax grab and keep GP clinics open!’ petition is now live and open for signatures.
As part of the campaign, Victoria’s 1500 clinics have been armed with posters and brochures for patients, calling on communities to get on board and sign the petition.
‘The RACGP has been advocating to all levels of government to stop payroll tax, but it is falling on deaf ears. But you can help,’ the petition says.
RACGP Victoria Chair Dr Anita Muñoz described the payroll tax changes as an ‘absolute catastrophe’ for general practice, patients, and the health system at large.
‘We know that more than 30% of practices that have to meet that taxation bill are likely to become instantly insolvent,’ she said.
‘If that tax is applied, we know that every single service that is rendered by a GP in the state is likely to cost a minimum of $20 per service more.
‘We expect that many patients who are already struggling to see their GPs will now no longer be able to afford to see their practitioners.’
Pressure has been building on the Victoria Government to scrap the tax, but it is yet to announce any amnesties.
Queensland backed away from its rollout last month, while Western Australia has ruled it out completely.
New South Wales, South Australia, and the Australian Capital Territory have all introduced amnesties or concessions, giving GPs more time to chart a way forward accommodating the tax burden.
But in Victoria, it is hoped the departure of former Premier Daniel Andrews could mean change is on the horizon.
Australian GP Alliance Deputy Chair Dr Mukesh Haikerwal said if nothing changes, it will not just be the doctors at risk.
‘Unfortunately, patients are being asked to pay a lot more and this is not going to be sustainable,’ he said.
‘What we’re seeing with these processes is the destruction of the healthcare system as we know it and lack of access to GPs who are the backbone of the healthcare system, and unfortunately, people’s health will suffer.
‘This is a big problem emerging that’s going to go beyond general practice, and it’s going to affect the entire society.’
Previous newsGP polls have revealed just 3% of practices would be able to absorb the costs of extra payroll tax, and more than half of respondents said they would have to increase out-of-pocket fees by more than $20.
A separate newsGP poll found more than one third of respondents would consider moving interstate if that region offered more favourable payroll tax requirements.
Dr Muñoz said if nothing changes, Victoria will face a mass clinic closure on a scale never seen before.
‘This really is the biggest existential threat to general practice and the health system, certainly in my entire career, but also in the last three decades,’ she said.
‘If we don’t get this right, and if we fail in this opportunity, then we will not have GPs to train, we won’t have GPs to teach, and we won’t have the practices available to see patients who need care.’
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