4 July 2015
The single largest contributor of taxation revenue in Queensland and Victoria is payroll tax.
Queensland taxed businesses on their wages nearly $4 billion in 2014-15. Victoria which has a lower exemption threshold and higher payroll taxation rate taxed its businesses nearly $1 billion more.
Payroll tax is a tax on employers calculated on the employer’s payroll.
The current exemption threshold in Queensland is $1.1m whilst in Victoria it is only $550,000.
In Queensland employers pay 4.75% tax on their wages above the threshold amount. Victorian businesses pay 4.85%.
There are frequently calls by business associations throughout Australia to substantially reduce or remove payroll tax because it is regarded as a disincentive to employ staff.
