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[Child care operator] Stepping Stones has sacked 19 staff and cut at least eight child care services across Tasmania because it can not afford to pay a $120,000 payroll tax bill.
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The Miscellaneous Workers Union believes the bill is not the company's only financial concern.
The union's David O'Byrne says he wants to see the company's full financial circumstances.
"At this stage were not convinced that purely payroll tax is the problem," he said.
Mr O'Byrne says one way of fixing the problem is for the company to switch from a for-profit to a non-profit or community organisation which is not subject to payroll tax.
The company's chief executive Chantal Williams although some staff have been laid off she is hopeful no other services will have to be cut.
"Stepping Stones is a viable business, we're not financially in trouble at all."
"There's no smokescreen," she said.
- reprinted from ABC News