The Federal Government’s Economic Response to Coronavirus and how it may benefit you in simple terms.
The Morrison Government has announced a $17.6bn economic plan to stimulate the economy to keep Australians in jobs, keep business in business and support Australian families in the wake of the spread of the Coronavirus. The incentive is broken down into 4 key parts:
Helping Businesses:
Supporting business investment
Increase the Instant Asset Write-off threshold from $30,000 to $150,000 until 30th June 2020.
Businesses with a turnover of less than $500M will be able to deduct 50% of the asset cost in the year of purchase until the 30th June 2021 with the balance deductible at normal depreciation rates.
Providing cash flow assistance
Providing cash flow assistance to help small and medium sized business to stay in business and keep their employees in jobs
An incentive of up to $25,000 (with minimum of $2,000) for anyone who employs staff between 1 January 2020 and 30 June 2020. Business will receive a 50% rebate of their PAYGW reported on their BAS for this period.
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.
Helping Individuals:Household stimulus payments that will benefit the wider economy
A one-off $750 stimulus payment to pensioners, social security, veteran and other income support recipients and eligible concession card holders. Around half of those that will benefit are pensioners. The payment will be tax free and will not count as income for Social Security, Farm Household Allowance and Veteran payments.
There will be one payment per eligible recipient. If a person qualifies for the one off payment in multiple ways, they will only receive one payment. Payments will be from 31 March 2020 on a progressive basis, with over 90 per cent of payments expected to be made by mid-April.
Targeted support for the most severely affected sectors, regions and communities;
$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. It will also include additional assistance to help businesses identify alternative export markets or supply chains. Targeted measures will also be developed to further promote domestic tourism. Further plans and measures to support recovery will be designed and delivered in partnership with the affected industries and communities
Article Written by Paul Wineberg
Paul is a member of the Institute of Chartered Accountants, a Certified Management Accountant
Paul is a Director of South East Accounting.
