Payroll tax: Barwon MP Roy Butler and Shooters, Fishers and Farmers leader Robert Borsak want payroll tax axed

The Shooters, Fishers and Farmers MP believes a tax on employing people doesn't make sense, and removing it would help restart damaged regional economies.

"Payroll tax from our perspective is a handbrake on regional economical growth and regional employment," Mr Butler said.

Mr Butler along with Shooters, Fishers and Farmers party leader Robert Borsak said they were meeting with a number of employers across the western region to discuss the pressures they faced after years of drought and the impacts of COVID-19.

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According to the MP, a regional zonal tax solution would provide financial incentives for people and businesses to live, work and invest in regional NSW.

"Bindaree Beef [in Inverell] for example employ 880 people and processes 1000 cattle every day, and they pay $3 million a year in payroll tax," Mr Butler said.

"Now they want to keep everyone employed, but they also want to grow the business ... but they can't grow the business and keep 880 people employed.

"Getting rid of payroll tax would enable them to both grow their business, maintain the security of employment with the people that are working for them and potentially employ more people."

Mr Butler said payroll tax in regional NSW outside Newcastle, Sydney and Wollongong would cost the government just $1 billion of $87 billion across the state.

"Its such a small amount of payroll tax that's collected, that would provide such a huge benefit to regional NSW in terms of keeping people employed and growing businesses," he said.

It was indicated there would be some consideration made towards payroll tax in the November budget, however Mr Butler said they weren't looking for a holiday, but rather a long-term change.

"What we actually want to see is the actual abolition of payroll tax in regional areas outside Sydney, Newcastle and Wollongong," he said.

"To provide that unfair playing field, to provide that advantage that would encourage businesses to come to regional NSW or stay in regional NSW and to employ more people in NSW."