Govt might try cap on for size, AMA warns
The AMA has warned the Federal Government it could face a damaging campaign during the forthcoming Federal election if it revives plans for a cap on deductions for work related education expenses in its hunt for Budget savings.
As ministers come under mounting pressure to identify cuts and savings to improve the bottom line for the 3 May Budget, the AMA has called on Treasurer Scott Morrison to reaffirm the Government’s commitment to supporting the continuing education requirements of professionals, including doctors.
AMA Vice President Dr Stephen Parnis said there had been worrying reports the Government could be considering resurrecting unpopular measures, including imposing a ‘standard deduction’ for work-related expenses.
“This would effectively be a cap by another name,” Dr Parnis said.
In 2013, the former Labor Government announced plans for a $2000 cap on tax deductions for work-related self-education expenses, a measure that would have disadvantaged thousands of workers who have to undertake continuing education as a condition of their employment.
The proposal provoked outrage among doctors and other professionals, and the AMA was among 70 organisations that formed the Scrap the Cap Coalition to fight the change.
The Abbott Government won plaudits when it dumped the idea soon after winning the 2013 Federal election, but there are now fears Prime Minister Malcolm Turnbull may reinstate the measure to help narrow the Budget deficit.
In December, the Government revealed its financial position had worsened since last year’s Budget, the deficit was on track to reach $37.4 billion in 2015-16, and warned there would be no return to surplus in the next four years.
Since then, commodity prices have tumbled lower and economic conditions have remained soft, fuelling concerns the Commonwealth’s finances have become even worse.
The Government has talked down earlier suggestions of tax cuts, and is searching hard for savings, including by trying to push more of the responsibility for health and education funding onto consumers and the states.
Dr Parnis said a parliamentary inquiry into tax deductibility added to concerns that deductions for self-education expenses could be in the Government’s sights.
“We are urging the Government to resist any moves to put in place, directly or indirectly, a cap on deductions for legitimate work-related self-education expenses in the Budget or in any new tax policies,” he said, pointing out it would have a severe impact on doctors and other professionals who must continually update their skills and knowledge throughout their careers, at their own expense.
“Doctors must learn new about new technologies, surgical techniques, treatments, and pharmaceuticals if they are to provide the best possible care to save lives and improve quality of life for their patients,” Dr Parnis said. “Doctors can spend many thousands of dollars each year undertaking mandatory courses and professional development to equip them with essential skills in caring for patients.”
The AMA Vice President said doctors in rural and remote areas would be hardest hit, because they were forced to travel to attend training courses and seminars.
He warned it would create a “huge disincentive” for junior doctors to pursue specialist education, potentially creating or adding to shortages of specialists in the future.
If the Government does include the measure in next month’s Budget, it is likely to meet with powerful opposition.
Already, discussions have been held about reconvening the Scrap the Cap alliance and mount a vigorous campaign during the forthcoming Federal election if the Government does move to impose some form of education expenses cap.