Federal and State Government’s Economic Stimulus Package Announcements
Both the Federal and State NSW Governments are backing businesses to invest to help the economy withstand and recover from the economic impact of Coronavirus. Several business investments measures have been announced across federal and state specific packages, which are are designed to assist Australian and New South Wales businesses and economic growth in the short-term, and encourage a stronger economic recovery following the Coronavirus outbreak.
These measures will support over millions of businesses with aggregated annual turnover of less than $500 million.
Federal Stimulus Package:
The Federal Government has announced a $17.6 billion economic stimulus package outlining several measures in support of Australian businesses.
The Economic Stimulus Package includes:
- Supporting business investment
- Cash flow assistance to help small and medium sized business to stay in business and keep their employees in jobs
- Targeted support for the most severely affected sectors, regions and communities
- Household stimulus payments that will benefit the wider economy
Support for business investment –
The Government is backing businesses to invest to help the economy withstand and recover from the economic impact of the Coronavirus.
- Increasing the instant asset write-off: The instant asset write-off threshold has been increased from $30,000 to $150,000 and has been expanded to include all businesses with aggregated annual turnover of less than $500 million (up from $50 million) until 30 June 2020.
- Accelerating depreciation deductions: Businesses with a turnover of less than $500 million will be able to deduct 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset’s cost until 30 June 2020.
Cash flow assistance for businesses –
Two measures will be introduced to support small and medium businesses:
- Boosting Cash Flow for Employers: Small and medium-sized businesses will receive between $2,000 and $25,000 paid by the Australian Taxation Office based on tax withheld. About 690,000 businesses employing around 7.8 million people are expected to be eligible for this payment.
- Supporting 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 made available to a new employer that employs that apprentice.
Stimulus payments to households to support growth –
Welfare recipients, such as those on Newstart, carers’ allowance, youth allowance, family tax benefits and aged pensioners, will receive a one-off cash payment of $750.
Assistance for severely affected regions –
The Government has set aside $1 billion to support 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.
New South Wales Stimulus Package:
The NSW State Government has announced it will spend $2.3 billion on the coronavirus crisis, including boosting intensive care units, buying critical equipment such as ventilators and setting up respiratory clinics.
More details will follow from the announcement.
The package aims to work together with the federal government. It will provide more resources to help slow the spread of this virus and boost treatment for those people in our community who need it most.”
The package also includes $450 million to waive payroll tax for the next three months for businesses with payrolls of up to $10 million.
There will also be $80 million to axe a range of fees and charges for small businesses including bars, cafes, restaurants and tradespeople and $250 million to employ extra cleaners of public infrastructure such as transport assets, schools and other public buildings.
More than $250 million will be spent to fast-track maintenance on public assets including social housing and crown land fencing and $500 million to bring forward capital works and maintenance.