Step forward for GPs’ payroll tax relief

The RACGP has welcomed Tuesday’s 2025–26 Australian Capital Territory Budget, which progresses significant changes to how payroll tax is applied to general practices.
 
The college has also welcomed measures in the 2025–26 New South Wales Budget to boost primary healthcare, also handed down on Tuesday, but says ‘missed opportunities’ remain to rebuild the state’s GP workforce.
 
The ACT Budget includes changes to payroll tax rules from 1 July, exempting general practice revenue from bulk-billed services from payroll tax liabilities.
 
RACGP NSW&ACT Chair Dr Rebekah Hoffman welcomed the tax reforms, which take a similar approach to Victoria and South Australia.
 
‘The previous payroll tax settings affected practices’ ability to recruit GPs and provide affordable care,’ she said.
 
‘Canberra has an ageing population and many Canberrans live with chronic disease, so it’s essential they can see a GP when they need to.
 
‘The payroll tax changes will have a significant impact on Canberra practices’ financial viability and our ability to attract GPs to work in the capital.’
 
Under the changes, the 52.8% of GP services that are bulk billed in the ACT will not count towards payroll tax liabilities, helping to ease some pressures on clinics facing challenges related to costs and bulk-billing models.
 
In a pre-election promise, the ACT Government promised $11 million to encourage more bulk billing in the ACT and expand the availability of multidisciplinary care in local general practices. 
 
Also progressing with ACT Labor’s 2024 election commitments, the new budget details funding to attract and retain GPs in the territory under a $4 million plan, improve access to general practice care, and support GP wellbeing.
 
It also includes investments to meet demands in outpatient services, reduce elective surgery waitlists, and improve patient flow through the hospital system.
 
Dr Hoffman said the RACGP looks forward to working with Chief Minister Andrew Barr to support affordable and accessible general practice care.
 
‘We’ll work alongside the ACT Government to boost access to care, including on its planned $4 million professional development and wellbeing fund to retain GPs and attract the next generation of GPs to train in Canberra.’
 
Meanwhile, the NSW&ACT Chair says the NSW Budget ‘missed opportunities’ to strengthen the GP workforce and improve access to care, particularly in rural and remote areas.
 
‘NSW could have done significantly more here, particularly through low-cost measures that deliver high value for patients in the long term,’ Dr Hoffman said.
 
‘It’s a big spend, but a lot of missed opportunities, too. Our population is ageing and needs more long-term care by GPs who know them and their history.
 
‘While Sydney and other major metro areas have a significant number of GPs, our rural centres and towns do not.
 
‘The best way to keep people healthy and out of hospital is to fund preventive care delivered by GPs.’
 
Investment in general practice to reduce hospitalisations is lacking in the NSW Budget, according to the RACGP, which proposes measures to grow the state’s GP workforce and support rural patients to access care in its NSW Pre-Budget Submission 2025–26. 
 
This college wish list included funding for locum GPs to provide care for patients in remote areas when GPs are absent or on leave, incentives for GP training, meningococcal B vaccination, and better support for GPs in disasters.
 
‘The NSW Government can improve access to GPs for our rural and regional communities by further incentivising GPs to train there,’ Dr Hoffman said.
 
‘Enabling more rural medical education at its universities will also boost access. Medical students from rural backgrounds are four times more likely to practise rurally, and GPs practise where they learn and train.
 
‘We will continue to call for smart solutions to address GP workforce issues.’
 
Payroll tax changes under the NSW Budget are welcomed by Dr Hoffman, who says the $104 million tax saving for GPs would ‘otherwise be borne by our patients in higher fees and reduced bulk billing’.
 
But similar to Queensland, she urged the NSW Government ‘could do more’ to support affordable and accessible general practice care and bulk billing by adopting a full exemption.
 
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