Australia to deploy $189 billion in bid to curb economic impact of COVID-19
Following the Federal Government’s stimulus package announcement of $17.6 billion, the recent increase to $66 billion combined with more than $100 billion in emergency banking measures takes the total to $189 billion deployed in a bid to curb the economic impact of COVID-19.
Prime Minister Scott Morrison says these measures have been put in place to help keep Australians in jobs, business in business and ensuring the economy bounces back stronger than before.
What’s in it for individuals?
The package includes an initial payment of $750 to an approximate 6.5 million pensioners and people who receive benefits, such as parents earning less than $100,000. A second payment of $750 will also go to some welfare recipients. The first payment will roll out on 31 March directly from the tax office with the second set to roll out 10 July 2020.
The new plan will also temporarily double the Jobseeker Payment, previously called Newstart as well as allowing people access to $10,000 from their superannuation in 2019-20 and 2020-21.
How will it affect SMEs?
The package has been designed to boost cash flow and assist with paying wages, business investments and preparations for a potential economic slowdown.
The table below is a brief break-down of the stimulus package incentives, including the dates each come into effect. Further details on the incentive is also included below the table.
|Incentive||Date of Effect|
|Two $750 payments from the tax office to pensioners and select benefit recipients|
|First payments will become available from 31 March 2020|
Second payments will be made to eligible recipients and concession card holders on 10 July 2020
|An increase in the instant asset write-off to $150,0000, and an increase of the threshold from $50 million to $500 million||Applicable to assets acquired from 12 March 2020 to 30 June 2020|
|Accelerated depreciation deductions for new and eligible depreciable assets (amounting to a 50% deduction in the first year)||Applicable to assets acquired from 12 March 2020 to 30 June 2020|
|Refunds of up to 50% of PAYG withheld from wages|
Applies to quarterly lodgers from 1 January 2020 to 30 June 2020;
Applies to monthly lodgers from 1 January 2020 to 30 June 2020
|Wage assistance in the form of a 50% reimbursement for businesses with apprentices and trainees||Payments will apply between 1 January 2020 to 30 September 2020|
|100% write-off||Assets costing less than $150,000|
|Guaranteeing 50% of new bank loans up to $250,000 to SME’s||Applies to offered loans taken out in 6 months from April 1 and cannot be used to refinance existing loans|
|Deeming rates reduced by a further 0.25 percent||From May 1|
Want to know more?
The Australian Treasury has released further details on some of the initiatives. Click the links below to learn more:
- Assistance for Households
- Assistance for Businesses
- Assistance for Business Investment
- Assistance for Severely Affected Regions
Supporting you through the changes. From making the most of the stimulus initiatives, through to managing the risks associated with the impact of the Coronavirus, the Modoras team is here to help you build a resilient business. Make well-informed business decisions; contact us on 1300 888 803 book a catch up with a Modoras professional.
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