As seen on the April 2020 issue of Philippine Tribune
As COVID-19 rocks the economy, Prime Minister Scott Morrison has made public a $23 billion stimulus package in an effort to prevent a recession.
Around 6.5million pensioners and people who receive government benefits that include families earning less than $100,000 will get one-off payments of $750.
The payments have begun on March 31 and would be automatically delivered through the tax system. Most of the other measures are aimed at supporting small businesses.
The government will hand out tax-free cash grants of up to a maximum of $25,000 to some 7,000 small businesses that turn over less than $50million and employ people.
Who are qualified to receive $750?
Recipients of Newstart Allowance; persons receiving disability support; carers’ allowance; youth allowance; veterans support payments; family tax benefits; holders of Commonwealth senior health card and aged pensioners.
There will also be a 50 per cent wage subsidy of $21,000 per apprentice. The cash will be paid to companies so they can afford to keep their young employees at work.
Instant asset write-offs will be expanded to allow tradies to buy a truck and other equipment worth $150,000 on the taxman until 30 June. The previous limit was $30,000.
The Prime Minister also promised to make sure casual workers who can’t find work because of the virus will not have to wait. They can immediately access Newstart’s sickness payment. There is also a $1billion fund to help tourism businesses affected by the downturn, similar to a disaster recovery fund. The ATO is also allowing affected businesses to delay their tax obligations for four months.
Cash flow assistance for businesses
● $6.7 billion to Boost Cash Flow for Employers by up to $25,000 with a minimum payment of $2,000 for eligible small and medium-sized businesses.
The payment will provide cash flow support to businesses with a turnover of less than $50 million that employ staff, between 1 January 2020 and 30 June 2020. The payment will be tax-free. This measure will benefit around 690,000 businesses employing around 7.8 million people. Businesses will receive payments of 50 per cent of their Business Activity Statements or Installment Activity Statement from 28 April with refunds to then be paid within 14 days.
● $1.3 billion to support small businesses to support the jobs of some 120,000 apprentices and trainees.
Eligible employers can apply for a wage subsidy of 50 per cent of the apprentice’s or trainee’s wage for up to 9 months from 1 January 2020 to 30 September 2020. Where a small business is not able to retain an apprentice, the subsidy will be available to a new employer that employs that apprentice.
Assistance for severely-affected regions
● $1 billion to support those sectors, regions and communities that have been disproportionately affected 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.
Currently, the instant asset write-off allows small businesses ━ those with an annual turnover of less than $10 million ━ to claim for new or second-hand equipment up to the cost of $30,000.
The threshold will be raised from $30,000 to $150,000 and expand to businesses with an annual turnover from $50 million to $500 million. Ω