Call again for the removal of NSW Payroll Taxes

Since early 2018, the Australian Childcare Alliance (ACA) NSW has been continuing to engage with the NSW Government regarding NSW Payroll Tax relief.

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To the NSW Government's credit, the threshold was raised from $750,000 to $1,000,000 to date before eligible early childhood education and care services were required to contribute NSW Payroll Taxes. This change has meant at least $27m of NSW Payroll Taxes were no longer collected per year.

In anticipation of the NSW Budget being handed down next week on 17 November 2020, ACA NSW has again asked the NSW Treasurer (the Hon Dominic Perrottet MP) for further NSW Payroll Tax reform - ideally its removal.

Payroll taxes are generally seen as both an inefficient tax as well as a cost-impediment to employing staff. And for early childhood education and care services, it contributes toward higher fees for parents as well as the need for more Commonwealth Child Care Subsidies.

Relief from the NSW Payroll Tax is one of the most obvious ways of addressing fee affordability for the NSW Government as well as fixing the pre-existing unfair playing field (where at one stage up to 1,727 early childhood education and care services were exempt from contributing payroll taxes estimated at $52,478,363 annually, yet up to 2,240 family-owned small business childcare operators were eligible to pay about $69,161,440 each year to the NSW Government).

It is time for the NSW Government to remove NSW Payroll Taxes for all NSW-based early childhood education and care services.