Expert criticises proposed payroll hike for GPs: ‘Stop taxing sick Australians’
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Australia's former Deputy Chief Medical Officer, Nick Coatsworth, strongly criticised the recent two-state payroll tax decision concerning General Practitioners (GPs), deeming it akin to imposing a 'tax on sick people'.
During an interview on Sydney's 2GB radio with Ben Fordham, Coatsworth explained that the decision made by the state revenue offices of Victoria and New South Wales to subject independent GPs to payroll tax would inevitably lead to a shift away from bulk billing practices.
'There's no other way to describe this than a tax on sick people, and it's gross, it really is,' he said.
'We've got three first ministers—Chris Minns in NSW, Dan Andrews [in Victoria], and Andrew Barr here in the ACT—leveraging a 5.5 per cent payroll tax when none was leveraged for several decades.'
'They've seen this court ruling, and they're putting their hands in the pockets of sick Australians.'
Doctors are concerned about recent actions by the Victorian and NSW state revenue offices, which they view as an attempt to increase tax revenue.
These offices have released rulings establishing a new stance: many independent General Practitioners (GPs) working within medical centres will now be liable for payroll tax.
Typically, medical practices pay payroll tax for their employees, such as reception staff, nurses, and doctors, under employment contracts.
However, the industry agreed that independent GPs comprised around 90 per cent of the GP workforce were exempt from this tax. This was because most GPs are not considered employees; they rent rooms from practice owners and operate based on independent agreements.
Now, three major medical associations—the Royal Australian College of General Practitioners (RACGP), the Australian Medical Association, and the Australian GP Alliance—are appealing to the NSW Premier Chris Minns and Victorian Premier Daniel Andrews to reconsider these changes.
They argue that implementing these tax regulations could lead to the closure of medical practices and an increase in the cost of medical services, making healthcare less affordable.
Although the Victorian and NSW governments assert that these rulings merely clarify existing policies, there is disagreement from GPs, medical associations, and accountants who believe that a major change is taking place.
'State governments are ripping funding from general practice to boost their own tax revenues,' said RACGP President Dr Nicole Higgins.
'It is the patients who will be hurt most when they lose their local GPs and access to essential care.'
On the radio show, Coatsworth advised NSW Premier Chris Minns to reconsider his decision about imposing a payroll tax on GPs. He emphasised that this tax would worsen the burden on already overwhelmed emergency departments.
'You can elect not to, maybe spend the money you've got in a better way and stop taxing sick Australians,' he said.
This news arrives at a crucial time, with GPs raising concerns about patients deferring or skipping appointments due to the ongoing cost-of-living crisis.
According to data from the online healthcare directory Cleanbill, patients in Victoria face an average out-of-pocket fee of $40.10, while those in NSW encounter a slightly higher fee of $41.06.
Members, what are your thoughts on these recent developments? Share them with us in the comments section below!
During an interview on Sydney's 2GB radio with Ben Fordham, Coatsworth explained that the decision made by the state revenue offices of Victoria and New South Wales to subject independent GPs to payroll tax would inevitably lead to a shift away from bulk billing practices.
'There's no other way to describe this than a tax on sick people, and it's gross, it really is,' he said.
'We've got three first ministers—Chris Minns in NSW, Dan Andrews [in Victoria], and Andrew Barr here in the ACT—leveraging a 5.5 per cent payroll tax when none was leveraged for several decades.'
'They've seen this court ruling, and they're putting their hands in the pockets of sick Australians.'
Doctors are concerned about recent actions by the Victorian and NSW state revenue offices, which they view as an attempt to increase tax revenue.
These offices have released rulings establishing a new stance: many independent General Practitioners (GPs) working within medical centres will now be liable for payroll tax.
Typically, medical practices pay payroll tax for their employees, such as reception staff, nurses, and doctors, under employment contracts.
However, the industry agreed that independent GPs comprised around 90 per cent of the GP workforce were exempt from this tax. This was because most GPs are not considered employees; they rent rooms from practice owners and operate based on independent agreements.
Now, three major medical associations—the Royal Australian College of General Practitioners (RACGP), the Australian Medical Association, and the Australian GP Alliance—are appealing to the NSW Premier Chris Minns and Victorian Premier Daniel Andrews to reconsider these changes.
They argue that implementing these tax regulations could lead to the closure of medical practices and an increase in the cost of medical services, making healthcare less affordable.
Although the Victorian and NSW governments assert that these rulings merely clarify existing policies, there is disagreement from GPs, medical associations, and accountants who believe that a major change is taking place.
'State governments are ripping funding from general practice to boost their own tax revenues,' said RACGP President Dr Nicole Higgins.
'It is the patients who will be hurt most when they lose their local GPs and access to essential care.'
On the radio show, Coatsworth advised NSW Premier Chris Minns to reconsider his decision about imposing a payroll tax on GPs. He emphasised that this tax would worsen the burden on already overwhelmed emergency departments.
'You can elect not to, maybe spend the money you've got in a better way and stop taxing sick Australians,' he said.
This news arrives at a crucial time, with GPs raising concerns about patients deferring or skipping appointments due to the ongoing cost-of-living crisis.
According to data from the online healthcare directory Cleanbill, patients in Victoria face an average out-of-pocket fee of $40.10, while those in NSW encounter a slightly higher fee of $41.06.
Key Takeaways
- Nick Coatsworth, Australia's former Deputy Chief Medical Officer, condemned the ruling by Victorian and NSW state revenue offices to subject independent GPs to the payroll tax, labelling it a tax on sick people.
- Coatsworth suggests this move will decrease bulk billing and accuses the states of taking advantage of a recent court ruling to leverage a 5.5 per cent payroll tax.
- Three doctor groups call on the NSW and Victorian premiers to reverse the changes, warning that they will lead to the closure of practices and increase healthcare costs.
- Despite the backlash, the Victorian and NSW governments maintain that the ruling does not represent a change, a perspective disputed by GPs, doctors groups and accountants.
Members, what are your thoughts on these recent developments? Share them with us in the comments section below!