Thursday, 1 June 2023

Schools payroll tax

Matthew BACH (North-Eastern Metropolitan) (15:42): (272) My adjournment matter tonight is for the Minister for Education.

Evan Mulholland: This afternoon.

Matthew BACH: This afternoon, rather. Sorry, Mr Mulholland, you are quite right: this afternoon. It is for the Minister for Education and it is regarding the Labor government’s new schools tax. In the budget the Labor government announced that it has a secret hit list of 110 schools – or, to quote the budget papers, ‘approximately 110 schools’ – which will now be liable to pay $422 million worth of additional taxation just over this budget period. But it is worse than that, even though the minister did not even know it was worse than that.

The government’s COVID levy and the government’s mental health levy kick in once an organisation’s payroll is at $10 million. There are so many independent schools that have payrolls much higher than $10 million – some have payrolls of over $100 million. However, extraordinarily, in the other place this week the minister was asked about this matter and she asserted that there is not one school in Victoria with a payroll over $10 million. Many state schools have payrolls over $10 million. I quickly checked the figures, and there are 69 – this is publicly available information – independent schools in Victoria that have payrolls over $10 million. But that is before you include the Catholics – and gee, the Catholics came out hard today. So many Catholic schools with mid-range fees of $8000, $9000 or $10,000 per annum are going to be absolutely thumped, paying, so says the principal of St Columba’s in Essendon, $800,000 a year in extra taxation.

The action that I seek from the minister is for her to outline to me exactly how much extra taxation independent schools will now pay just through having to pay the COVID levy and the mental health levy. She did not even know that these levies would now apply to many independent schools on her hit list – the vast majority of independent schools on her hit list. I would not mind seeing the hit list. It was put to me by a member of the press pack that given that the government has detailed economic modelling – this new tax grab is going to strip $422 million from independent schools – they must know which schools they are targeting, so just tell us.

Independent schools have a budgetary period that covers the calendar year, not the tax year. That is because schools operate on a timetable – term 1 starting in January, term 4 finishing in December – so many independent schools are well forward in their planning for next year. They do not know whether they are going to be forced to pay, in some cases, millions and millions of dollars in additional taxes.

The government has told us that it is going to raise $422 million through its new schools tax, but many of these independent schools are going to be hit with a triple whammy. I want to know from the minister how much additional tax on top of the $422 million independent schools are going to have to pay that have a payroll over $10 million. The number is not none that have a payroll over $10 million, it is 69 plus the Catholics. How much will they pay?