Economic stimulus package - Round Two - 23rd March 2020

A. Federal Government Announcements

Yesterday 22 March 2020, the Treasurer has announced its second Economic stimulus package.

The key business tax measures include modified cash flow assistance for employers:

• The previously announced tax-free payment of $25,000 for employers under $50m turnover (based on prior year turnover) will be increased to $50,000.
• The minimum payment will be increased from $2,000 to $10,000, and will include Not For Profit Organisations (NFP's).
• The payment will be based on 100% (instead of 50%) of the PAYG W amount reported in the activity statement for March 2020 and June 2020 (for quarterly lodgers) and March 2020, April 2020, May 2020 and June 2020 (for monthly lodgers).
• An additional payment equal to this amount will also be available from July to October 2020, taking the total available payments to $100,000 (minimum $20,000).
• The payments will be automatically credited by the ATO through the activity statement system.
• The payments will only be available to active eligible employers (other than charities) established prior to 12 March 2020.

• Tax-free early access to superannuation, up to $10,000, from mid-April to before 1 July 2020. Up to a further $10,000 will be available from 1 July 2020 for approximately three months.
• You must apply to the ATO, separate arrangements will be made for Self Managed Superannuation Funds and the following conditions apply: 

• Halving of minimum pension drawdown requirements (i.e. 4% becomes 2% for the remainder of the year ended 30 June 2020 and for the full year ended 30 June 2021.
• The previously announced $750 payment for income support recipients and concession card holders will now be two separate $750 payments: one from 31 March 2020 and the other from 13 July 2020.
• There will also be a new time-limited Coronavirus supplement to be paid at a rate of $550 per fortnight from 27 April 2020 for the next six months.
• Income support recipients will also have:

•  Increased IAWO i.e. increased asset threshold of $150,000 and turnover threshold of $500m until 30 June 2020;
• Limited 50% depreciation incentive until 30 June 2021;
• 50% wages subsidy for apprentices and trainees until 30 September 2020.

• Payroll Tax Waiver - $450 million has been allocated to waive payroll tax for businesses with payrolls of up to $10 million for three months. The State Government said these businesses would not have to pay the tax for the rest of this financial year.
• When companies lodge their Annual Statements for the year ended 30 June 2020, they will receive a 25% reduction of their primary payroll tax due.
• The next round of payroll tax cuts has also been brought forward to raise the threshold limit to $1 million for the next financial year.

• The immediate suspension of price rises until further notice.
• A review of payment terms to provide flexibility to industries hardest hit.
• The implementation of a dedicated support team to manage hardship applications.
• Providing information on access to government grants.

• World Health Organisation
• Australian Department of Health
• NSW Health