A quarter of Canberra's GPs would consider closing if payroll tax implemented, AMA says

Nearly half of all practice owners would also consider selling and 80 per cent are likely to increase their fees if they don't receive an exemption from the tax.

The Australian Medical Association ACT has said it surveyed medical practices about the effects of a payroll tax.

Chief Minister Andrew Barr announced last month practices would be exempt from the tax for two years if 65 per cent of all services were bulk billed.

But the association has said only 6 per cent of general practices surveyed would be able to increase their bulk billing rate to this amount to satisfy the exemption.

Australian Medical Association ACT president Walter Abhayaratna said the survey results showed the proposed exemption model was "deeply flawed" and very few practices would be able to take this up.

"Of considerable concern is the fact that some practice owners are looking at closing their practices or selling," he said.

"With Canberra already having the lowest ratio of GPs to population of any Australian city, we can ill afford to lose any practices or GPs."

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The survey results also showed 80 per cent of practices believed the tax would adversely affect the training of general practitioner registrars and 65 per cent believed the training of medical students would be affected.

"I'm also concerned about the impact on the training of our next generation of GP registrars and medical students with practices reporting that, faced with the new tax, they will have fewer resources and less time to teach trainee GPs and students," Professor Abhayaratna said.

More than one third of practices surveyed were likely to implement a patient levy of $5 and increase private billing fees by up to $10 as a result of the tax.

Professor Abhayaratna said 92 general practices were surveyed by the Australian Medical Association.

There has been a fierce debate between doctor lobby groups and the Chief Minister over the implementation of payroll tax. The tax will be applied to practices with a GP payroll higher than $2 million and it is only paid on the wages above $2 million.

Mr Barr has said the tax revenue to the government would be "minimal" and only a "handful" of medical practices would be required to pay it. He said the groups were making "wild accusations".

He said he was up for a "fair dinkum" conversation on how to increase bulk billing rates in the capital.

"At no point have any of those organisations come in and said that they would never increase their fees again if GPs were given a payroll tax exemption in the future," Mr Barr told the Legislative Assembly last week.

Historically, medical practices did not pay payroll tax for doctors as they were considered contractors.

But this changed after the NSW Supreme Court ruled general practitioners were subject to payroll tax.

ACT Opposition Leader Elizabeth Lee unsuccessfully attempted to bring forward a bill to completely exempt general practices from payroll tax.

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