The Gillard government has confirmed workers will face a tax increase through the Medicare levy to fund the National Disability Insurance Scheme
The Gillard Government's proposed levy hike will generate $3 billion per annum needed to boost the NDIS war chest ahead of its full introduction in 2018-19. Source: Supplied
THE proposed introducing by the Gillard government of an additional 0.5 per cent levy to Medicare to fund the National Disability Insurance Scheme will be the single biggest increase since it was introduced in 1984.
It will lift the levy from 1.5 per cent to 2 per cent in a bid to generate the $3 billion per annum needed to boost the NDIS war chest ahead of its full introduction in 2018-19.
The levy was originally set at 1 per cent of taxable income by the Hawke government in the biggest change to the nation's health system - before being lifted to 1.25 per cent two years later.
In the aftermath of the Port Arthur massacre in 1996, Prime Minister John Howard put an 0.2 per cent surcharge on the Medicare levy to fund the gun buyback scheme.
Jessica Irvine and Tory Maguire discuss the levy to fund the disability scheme
The following year, the Coalition introduced an additional levy of 1 per cent - the Medicare Levy Surcharge - for high income earners with an annual income of over $100,000 who do not have adequate levels of private hospital coverage.
This was followed in 1999 by an uncapped private health insurance rebate to encourage families to take-up private health insurance.
And in early 2000, the Howard government proposed a further Medicare levy increase to help fund Australia's role in East Timor - but this was later withdrawn in the lead up to the budget.
The Medicare system currently provides free hospital services for public patients in public hospitals and subsidies around 75 per cent of private patients' scheduled fees.
And it also covers around 85 per cent of scheduled fees for out of hospital services such as GPs and specialists.
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