GP practices in the ACT have been hit with debt notices as the Territory Government follows the lead of NSW, Victoria and Queensland in chasing payroll tax.

The move follows a string of legal judgements suggesting that GPs can be treated as employees rather than contractors when calculating whether a practice has reached the various payroll tax thresholds.

In the ACT, where the payroll tax rate is 6.85%, with a threshold of taxable wages fixed at $2 million a year, the practices affected will be forced to raise gap fees by $15 per consultation to cover the cost, claims RACGP president Dr Nicole Higgins.

“Now, the ACT Revenue Office has started contacting practices across Canberra regarding payroll tax. This ‘sick tax’ threatens the future of care in our capital,” she said.