Tuesday, 20 June 2023

Schools payroll tax

Ann-Marie HERMANS (South-Eastern Metropolitan) (21:01): (287) My adjournment matter is to the Minister for Education in the other place, and the action I seek is for the minister to provide me and all Victorians with an update on the current situation regarding the government’s recent backflip on stripping more than 110 private schools of the longstanding payroll tax exemption and to disclose when, on which date, we will find this information out about the school taxes and which schools have been actually implicated and will be impacted.

According to the budget the government advised that about 110 high fee paying schools, or around the top 15 per cent by fee level, were to lose their payroll tax exemptions from the middle of next year, based on an annual fee threshold of about $7500 per student. The Premier allegedly changed this recently to impact about 70-plus schools with a threshold in excess of $10,000 in annual fees per student. Advice on the new threshold and which private schools is needed immediately, as the new payroll tax is concerning parents and principals of schools in my electorate, and they want to know who is going to have to find more money.

An example of being excluded from this tax can be translated to a payroll tax accumulated to 5.85 per cent, leading to a significant impact on operating budgets which, once coupled with the 42 per cent increase on WorkCover premiums, could translate to a total 10 per cent increase in parents’ tuition fees over two years. With teachers’ wages set through enterprise bargaining agreements – and in many cases these have been fixed and agreed upon for the next three years – the additional money is going to have to come from somewhere. The financial increase will have to be forwarded to the parents in the school fees, and this is a huge ask of parents in any climate, but in these times many parents will have to reconsider their educational options. Some single-sex schools are concerned the fee increase will impact gender equity and learning as parents decide which of their children they can afford to have attend their preferred school. Many principals have also expressed concerns about how it will impact girls’ educational opportunities and options. Minister, please advise me and all Victorians when we will find out which schools will be affected by the removal of this tax exemption.