A $5,000 a year cap on salary packaging benefits being enjoyed by charity workers, paramedics and doctors has been targeted in the Federal Budget.
The budget has capped a subsidy which provided tax free food and entertainment to attract and keep people in perceived lower paid, public sector jobs.
The government is aiming for a $300 million dollar saving but paramedic Martin Camp told Neil Mitchell it’s effectively a pay cut.
“We all probably suffer a take-home pay cut,” he said.
“Basically if we spend money on meals and entertainment or we go away for the weekend, we can salary package that, which means we pay a bit less tax.
“Originally it was introduced to encourage people to work in the public health system and the charities.”
Dr Mark Yates, an Australian Medical Association Board member and geriatrician based in Ballarat, said there would be an impact.
“The salary packaging arrangements have been part of the system for upwards of 10 years,” he said.
“And most of the contracts, if you look at them, it includes rolled up salary packaging.
“It actually assists the state government in providing remuneration back to doctors.”
Neil Mitchell asked Federal Treasurer Joe Hockey if specialist doctors may leave the public system now because of reduced perks.
“They’re still going to have a $17,000 exemption cap. And they’re still going to have $5000 in relation to meals and entertainment,” Federal Treasurer Joe Hockey said.
“I just think when the rest of the community gets no exemption … I think it’s reasonable.
“They get more than everyone else. We’re just trying to prevent people from putting their weddings, and going on overseas trips, and taking their friends out to dinner from doing it at the expense of other taxpayers.”
Source: 3AW News talk