RACGP payroll tax fight hits Canberra

The RACGP is calling on governments to ‘step up’ and find a solution to potentially devastating payroll tax reforms, as it takes its battle for change to Canberra.
 
Australian Capital Territory GPs say they have been left with no choice but to increase patient fees in the midst of the tax changes, with some clinics already closing up all together.
 
RACGP NSW and ACT Chair Dr Rebekah Hoffman travelled to Canberra to deliver the college’s pleas in person, saying patients’ ability to access a GP is under threat from their own government.
 
Dr Hoffman met with several Canberra GPs, politicians, and media outlets to spread the word that urgent change is needed before it is too late.
 
‘This GP payroll tax is a tax on patients, and unfortunately, it will bite … we need a solution that actually reflects the high costs in the ACT,’ she said.
 
‘Unfortunately, the ACT Government has left GPs with no choice but to increase fees. If other jurisdictions offer better remuneration and cheaper cost of living, more GPs will leave and fewer GPs will come to Canberra.

‘It’s clear the ACT government needs to do more to attract GPs to practise in Canberra, but in not working towards a solution, it’s doing the opposite.’
 
Currently in the ACT, general practices will receive payroll tax amnesty until June 2025, provided they bulk bill nearly two-thirds of their patients.

However, this approach has drawn widespread dismay from GPs, and the RACGP is now urging the Territory Government to take longer-term action.  
 
Across Australia, so far Queensland has provided a workable solution, while other states have offered amnesties.

Canberra GP and principal of the East Canberra General Practice Dr Clara Tuck Meng Soo has already had to close a practice and is worried there will be more to come.
 
‘This is a tax on patients and a tax on health,’ she said.
 
‘Unlike our elected representatives, GPs are asked to choose between their conscience and their income, to earn less to increase access for our patients.
 
‘We can only do so much.
 
‘Every dollar we pay in payroll tax is an incentive against bulk billing.’
 
Pressure continues to mount on state and territory governments to scrap the tax, with both Federal Health and Aged Care Minister Mark Butler and Federal Treasurer Jim Chalmers raising significant concerns.
 
It comes after a recent HotDoc survey found general practices expect an average increase of $12 for a standard 20-minute consultation under the payroll tax changes.
 
Dr Meng Soo said general practices simply do not have the profitability to afford to absorb payroll tax on patients’ behalf.  
 
‘General practices are small businesses with narrow margins,’ she said.
 
‘We have had to impose a $3 levy on privately billed patients, but we’re at the lower end and still coming up short from where we were before payroll tax was imposed on independent GPs.
 
‘I believe other practices are charging more depending on their individual circumstances.’
 
ACT Chief Minister Andrew Barr has previously said his government’s goal is to ensure ‘vital services, like healthcare, remain accessible’.
 
‘The temporary exemption allows medical practices to align with payroll tax requirements without the risk of unexpected retrospective assessments,’ he said.
 
‘By offering this pathway, the ACT Government aims to support businesses in achieving tax compliance while keeping the community’s needs at the forefront of decision-making, including increasing healthcare accessibility and reducing cost of living.’
 
Last year, the RACGP launched a petition calling for the tax to be ditched, which has so far gained more than 13,200 signatures from doctors and patients alike.
 
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