Minister Barr: Incentives for more bulk billing: temporary GP payroll tax exemption to support healthcare access and fairness
- Written by ACT Government
Released 26/08/2023 - Joint media release
The ACT Government is addressing the impact of payroll tax on general practice (GP) medical centres by introducing a temporary payroll tax exemption complementing recently announced Commonwealth Government bulk billing incentives.
The proposed GP Payroll Tax Exemption underscores a shared government commitment to accessible healthcare for all Canberrans.
The ACT already has the highest payroll tax-free threshold in Australia at $2 million per annum. This means most small and medium-sized businesses, including most GP healthcare centres, fall below this threshold and are not liable for any payroll tax.
The ACT Government has been engaging with GPs, and their representative organisations, to assess the impact of payroll tax on the handful of general practices in the ACT that are above the $2m tax free threshold. This number is less than 10.
Following this review, several steps are being taken to address payroll tax concerns for those practices with payrolls over $2m, including:
- Waiving payroll tax liabilities: Waiving payroll tax liabilities until 30 June 2023 for medical practices that have not previously paid payroll tax on GP payments. This waiver will ensure general practice businesses are not subject to retrospective assessments. Given almost all practices fall well below the $2m threshold this measure is confined to a very small number.
- Extended time for compliance: To provide further time for general practices that support the community with reasonable levels of bulk billing to review their taxation arrangements, seek advice, and implement necessary changes to ensure future compliance with their payroll tax obligations through [until 2025]
- Two-year exemptions for bulk billing: A payroll tax exemption on GP payments until 30 June 2025 for healthcare businesses making payments to GPs that:
- are bulk billing 65 per cent of all patients;
- have registered for MyMedicare; and
- register with the ACT Revenue Office by 29 February 2024
The GP Payroll Tax Exemption Proposal offers certainty to medical practices while ensuring equitable treatment across industries and businesses.
By supporting GP practices who bulk bill, and maintaining fair tax treatment, the ACT Government is enhancing healthcare access and alleviating financial burdens for Canberrans seeking primary health care.
The Government will continue to ensure its approach to improving access to primary health care remains comprehensive, fair and well-informed. For the latest updates on the GP Tax and Payroll Tax Exemption Proposal, please refer to official announcements from the ACT Government, the ACT Revenue Office, and relevant industry associations.
Quotes attributable to Chief Minister, Andrew Barr:
The review of GP payroll tax is a proactive step in our commitment to refining policies that impact all Canberrans, including their access to affordable healthcare. We are ensuring that medical practices have ample time to adapt, seek advice, and align with payroll tax obligations.
Our goal is to ensure that 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.
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.
Quotes attributable to Minister for Health, Rachel Stephen-Smith:
We recognise the vital role that general practice plays in our community's well-being. We remain committed to accessible and affordable healthcare for all Canberrans and better integrating care across all parts of the health system.
The GP Payroll Tax Exemption Proposal aligns with our vision by offering medical practices the necessary time and support to ensure compliance while prioritising the needs of our community.
By engaging with stakeholders, we aim to take a comprehensive approach to the review of GP payroll tax. This inclusive process ensures that our policies remain informed and supportive of both businesses and individuals in our community.
- Statement ends -
Andrew Barr, MLA | Rachel Stephen-Smith, MLA | Media Releases
