In an effort to combat the economic effects of the global coronavirus pandemic, the government has released a $17.6bn stimulus package which is expected to provide direct support for up to 6.5m individuals and 3.5m businesses.
The package includes the following: Business investment initiatives – the instant asset write-off threshold will be increased from $30,000 to $150,000 and expanded to include access for businesses with an aggregated annual turnover of less than $500m (up from $50m) until 30 June 2020. A time-limited 15-month investment incentive (through to 30 June 2021) will also be provided to support business investment by accelerating depreciation deductions.
Businesses with a turnover of less than $500m will be able to deduct an additional 50% of the asset cost in the year of purchase. Cash flow assistance payments for SMEs – eligible SMEs will receive a Boost Cash Flow for Employers of up to $25,000 (with a minimum payment of $2,000). Businesses will receive payments of 50% of their BAS or IAS from 28 April 2020 with refunds to then be paid within 14 days. Apprentices and trainees – small businesses will also receive a total of $1.3bn to support the jobs of 120,000 apprentices and trainees.
Eligible employers can apply for a wage subsidy of 50% of the apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020. Where small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice. The household stimulus for pensioners – a one-off $750 stimulus payment will be made to pensioners, social security, veteran and other income support recipients and eligible concession cardholders. Payments will be made from 31 March 2020 on a progressive basis, with over 90% of payments expected to be made by mid-April. The payment will be tax-free and not count as income for Social Security, Farm Household Allowance and Veteran payments.
There will be 1 payment per eligible recipient. If a person qualifies for the one-off payment in multiple ways, they will only receive 1 payment. Support for impacted sectors, regions and communities – $1bn will be provided for sectors, regions and communities that have been disproportionately impacted by the economic impacts of the coronavirus, including those heavily reliant on industries such as tourism, agriculture and education.
This will include the waiver of fees and charges for tourism businesses that operate in the Great Barrier Reef Marine Park and Commonwealth National Parks. It will also include additional assistance to help businesses identify alternative export markets or supply chains. In addition to the targeted measures, administrative relief will be provided for certain tax obligations, including deferring tax payments up to 4 months.