There are concerns that the Victorian government’s decision to reclassify contracted doctors in order to make them pay payroll tax could make visiting the doctor unaffordable for Victorians.

Former federal president of the Australian Medical Association, Dr Mukesh Haikerwal, told Neil Mitchell that the decision would force doctors to raise fees to cover the tax, which would leave Victorians unable to afford the visit to their GP and increase the strain on hospitals.

“What would cost $50 to $80 would end up costing $500 just going to hospital, increasing the load of the hospital by ten-fold,” he said.

Press PLAY to hear how doctors will be impacted by the tax

Dr Haikerwal wrote on Twitter that the potential increase load on the hospitals would negate the tax.

#SRO (staterevenueoffice) genius who dreamt up revised interpretation of #PayrollTax on Commonwealth payments #MBSREBATES maybe heroic and raise cash on 1 side of the ledger. practices living of slender margins rendered insolvent. 1/2 https://t.co/VQSi4oWzHh

— Mukesh Haikerwal (@DrMukeshH) May 21, 2023

2/2 We will see wholesale destruction of general practice that has slender margins as a business. Practices can & will raise a fee to cover the State Tax on health. BulkBilling cannot then happen. The load on State hospitals will sky-rocket. This will negate ANY TAX “gained”. https://t.co/H87qBelgsZ

— Mukesh Haikerwal (@DrMukeshH) May 21, 2023

Dr Haikerwal also said the tax would be retrospective and will force doctors to pay tax for the last five years.

“Practices are getting hit for several millions in some places because it’s five years retrospectively and they don’t actually have that,” he said.