Question On Notice No. 1685 asked in the Legislative Council on 23 September 2014 by Hon Lynn Maclaren
Question Directed to the: Minister for Mental Health representing the Treasurer
Parliament: 39 Session: 1
Question
(1) Has the Government ruled out granting a payroll tax exemption to aged care providers following the Federal Government’s decision to remove its supplement?
(2) What does the Government understand to be the implications of this for the sector?
(3) What impact would addressing the need to provide an exemption to this payroll tax have on the State Budget?
Answered on 18 November 2014
(1) The State Government will not be compensating private aged care providers for the Commonwealth Government's decision to remove its Aged Care Payroll Tax Supplement.
(2) The 2014‑15 Commonwealth Budget redirected $1.5 billion over five years from the cessation of various schemes to increase the basic subsidy for all aged care providers from 1 July 2014. The extent to which this change compensates providers is not clear and will depend on individual circumstances.
(3) The exact impact of providing a payroll tax exemption is hard to quantify.
The supplement covered only staff directly providing care-related services in residential care facilities and indirect payroll tax liabilities of not-for-profit providers for services outsourced to third parties. Providing a specific exemption for aged care providers may also set a costly precedent to do the same for other commercial businesses that compete with the not-for-profit sector (e.g. child care, private hospitals).