A TAX exemption for doctors is expected to increase bulk-billed consultations and encourage more people to seek medical care.
The Victorian Government will provide an exemption from payroll tax for payments to contractor GPs and to employee GPs for providing bulk-billed consultations from July 1, 2025, with interim exemptions from payroll tax in the period prior.
The government will introduce legislation in the coming months to make this change permanent.
“All general practice business will receive an exemption from any outstanding or future assessment issued for payroll tax on payments to contractor GPs for the period up to 30 June, 2024,” Victorian Treasurer Jim Pallas’ office said in a statement.
The exemptions will continue to June 30, 2025 for contractor GPs on bulk-billed consultations, and that will extend to employee GPs from July 1, 2025.
The chief executive of Northern District Community Health Penny Wilkinson told The Guardian the issue of access to primary healthcare has very specific rural implications.
“The payroll tax exemption recognises the importance of primary care services, which includes General Practice, and the critical role it plays to keep people well and out of hospital,” she said.
“Sustainable primary care models are becoming more and more challenging in rural and regional communities. Both workforce shortages and current funding models are unable to meet community need, and this is only going to intensify with an ageing population and the rise in chronic health conditions.”
The Treasurer is following through on his promise to act in good grace in the event that the pressure of the payroll tax became too great for general practices.
“The Government has no interest in any GP clinic closing their doors, and I would be inclined to use my “ex gratia” power to prevent that happening were any GP clinic to become insolvent as a result of a payroll tax liability,” Mr Pallas said in a letter to medical representative bodies in 2023.
While the exemption is widely celebrated by GPs, medical professional representative bodies and the Opposition, the Australian College of Rural and Remote Medicine President Dr Halliday considers this as only the first step in further securing certainty for GPs.
“National Medicare reform is still required to improve healthcare affordability (and) ACRRM welcomes the opportunity to have ongoing engagement to understand the impact on rural, remote and First Nations communities and their ability to obtain timely, accessible and affordable primary health care,” Dr Halliday said.
The move comes after more than a year of consultation with the primary care sector about the pressures on GPs and the need for certainty, and mounting pressure from GPs, The Royal Australian College of General Practitioners (RACGP) and the Opposition.
A survey by online medical booking platform HotDoc revealed that 94 per cent of Victorian clinics would need to raise their consult fees, with more than half of those stating the increase would be more than $20.
Cleanbill’s 2024 Blue Report collaborated HotDoc’s findings, describing the downward trend of the accessibility of primary care Australia-wide as “catastrophic”, with 256 Victorian clinics at risk of closure.
The report found that in Victoria, the number of clinics offering bulk billing to non-concession patients fell 9.7 per cent, and those not offering bulk billing increased the out-of-pocket cost by 2.5 per cent on average after the Medicare rebate.
