‘Payroll tax squeezes the life out of sector’

Article by Lanai Scarr courtesy of the West Australian.

The CEO of one of Perth’s most successful technology companies has called on Mark McGowan to axe payroll tax or risk stifling growth in the sector.

Marcus Tan who co-founded medical online booking service HealthEngine said it was paramount the tax was removed or the sector would not reach its full potential in WA.

Payroll tax is a state tax that is calculated on wages paid or payable. A minimum tax rate of 5.5 per cent applies. Businesses have to have payrolls larger than $1 million in order to have to pay the levy.

Mr Tan said payroll tax “significantly impairs growth of start up companies who are still trying to find their feet”.

“We want to support a sector that is growing but not tax it,” Mr Tan, who secured a major Government contract on COVID vaccine bookings, said.

“It makes no sense for the State Government to be taxing those sorts of (start up tech) companies and they need to start reconsidering how they apply those sorts of taxes to types of companies like this.”

On a federal level Mr Tan said that Treasurer Josh Fydenberg needed to engage with the sector and be guided by them on policy.

“Let us show you where the opportunities are and how policy can really help the sector but also very much harm the sector and let us give you some ideas that can help the sector and the economy and the country all at the same time,” he said.

“We are trying to solve big problems and sometimes the rules aren’t very clear about what you can and can’t do.”

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