Queensland’s government has followed through on a pledge to introduce legislation entirely exempting general practice from payroll tax on contractor doctors.
GPs in Queensland are now free from the spectre of payroll tax, in a move that the state government is expecting will help raise bulk-billing rates.
The Revenue Legislation Amendment Bill was introduced into Queensland parliament on Thursday morning, the last sitting day of the year.
According to Treasurer David Janetzki, the bill will amend the Payroll Tax Act 1971 by introducing an exemption providing that wages subject to payroll tax do not include wages paid or payable by a medical practice to general practitioners.
In an unexpected boon, The Medical Republic understands that the exemption will include GP registrars, who have traditionally been treated as employees of individual practices and thus have been eligible for payroll tax.
Both employee GPs and contractor GPs are covered by the exemption.
There are no minimum bulk-billing thresholds in order to qualify.
While the legislation works its way through parliament, the government has authorised the state revenue office to administer the exemption under an administrative arrangement backdated to 1 December.
The administrative arrangement, which will be live until the legislative amendment receives royal assent, effectively puts the exemption into place immediately.
Mr Janetzki was confident that, with a payroll tax exemption in place, primary healthcare would be more affordable in the state.
“Medical practices have been under financial strain, leading to lower rates of bulk billing and therefore increased out-of-pocket costs for patients,” he said.
“We pledged to introduce an exemption to provide that wages liable to payroll tax do not include wages paid or payable by medical practices to general practitioners … to make general practitioner care more affordable for all Queenslanders.”
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The introduction of the bill into parliament was welcomed by RACGP Queensland chair Dr Cath Hester, who thanked the government for “making general practice care more affordable for Queenslanders”.
“General practice care is essential for the health and wellbeing of all Queenslanders, and for reducing pressure on Queensland’s hospitals and ambulances,” she said.
“And it’s critical that general practice can thrive in Queensland to meet patient needs today, and in the future.”
RACGP national president Dr Michael Wright and NSW/ACT chair Dr Rebekah Hoffman both called for other states to pass full exemptions.
“In New South Wales, the RACGP looks north to see a state government that truly values and invests in primary care,” Dr Hoffman said.
AMA Queensland president Dr Nick Yim also welcomed the bill, but said the association would push for the exemption to apply to non-GP specialists as well.
“This is a great result and one that AMA Queensland has been fighting for since 2021 when the interpretation of payroll tax changed without warning,” Dr Yim said.
“Practices were hit with unexpected, backdated tax bills that threatened their viability.
“They were faced with passing these new costs on to their patients or closing their doors.”
