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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2023-10-19 Daily Xml
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General Practitioner Payroll Tax

Mrs HURN (Schubert) (14:23): My question is to the Minister for Health and Wellbeing. How does the minister respond to comments made by the Royal Australian College of GPs in South Australia about payroll tax changes? With your leave, sir, and that of the house, I will explain.

Leave granted.

Mrs HURN: The Royal Australian College of GPs has stated that the application of payroll tax on tenant GPs would most likely lead to patients paying around $15 more out-of-pocket per consult and general practice closures, meaning that people would have no option but to attend hospital emergency departments, leading to an increase in emergency wait times.

The SPEAKER: Treasurer.

The Hon. S.C. MULLIGHAN (Lee—Treasurer) (14:24): Thank you, Mr Speaker.

Mrs Hurn: What about the minister's response—the Minister for Health?

The SPEAKER: The member for Schubert, you have asked the question. The Treasurer is on his feet—

Members interjecting:

The SPEAKER: Order!—and the Treasurer has the call.

The Hon. S.C. MULLIGHAN: The minister responsible for taxation and finance matters happens to be the Treasurer. Payroll tax happens to be a tax levied out of RevenueSA, for which I am responsible to the parliament. I don't think it's rocket science. Goodness me! Do you even talk to each other about tactics for question time—because it looks from the outside that the answer is no.

Members interjecting:

The SPEAKER: Member for Florey!

The Hon. S.C. MULLIGHAN: It is just extraordinary. It's just remarkable. As I have previously advised the house, I have been engaged in particular with the royal college in South Australia responsible for representing GPs about the application of payroll tax to their members, and I have to say that the approach from their leaders in South Australia, principally Sian Goodson, has been extremely good and frequent and forthcoming.

It has been the royal college's representations in particular which have led the government and me to decide on a number of very significant and beneficial concessions in favour of GPs, of their members, because on the face of it it has been reaffirmed, particularly by interstate courts, that payroll tax is applicable to the wages of GPs in GP clinics.

The normal approach of revenue offices around the country, including here in South Australia, is to conduct an audit to go back over the last five years of liabilities to determine what they are, require that those last five years of liabilities be repaid and then, usually, charge interest and penalty tax for not meeting those obligations. On the representations of Dr Goodson and the Royal College, we have waived those obligations.

In the course of discussions in the first half of this year, we also realised it was going to be impractical for GPs and those practices to come in to meet their obligations from the beginning of the next financial year, which was 1 July this year, and so we also offered to provide a full year so that we could engage directly with not only the college but also GPs, to help them understand how this issue impacts them.

Not only do they not have to pay their payroll tax obligations that haven't been met for up to five years, we also weren't requiring them to pay payroll tax from 1 July this year. We have given them a full 12 months of not having to pay payroll tax, which is, I should say, far more generous than the approach of some other jurisdictions around the country.

We have also committed resources to working with the royal college and directly with GPs to go through a process where they can register as a practice, or register as a wage earning entity, with RevenueSA. They can engage and understand their obligations, because it has become clear to me in the course of discussions with GPs and the royal college that some of these concerns about what it would mean for patients are based on assumptions about what payroll tax applies to.

It doesn't apply to the turnover of a business. It doesn't apply to all of the employee costs of a business. It only applies to the wages above a tax-free threshold, and the full payroll tax rate doesn't kick in until $1.7 million, and on top of that there are further deductions. That's why it's important that we continue to work with them.

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