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States exempt JobKeeper from payroll tax

The Queensland government is exempting JobKeeper payments from payroll tax in a bid to help businesses keep people employed.

States exempt JobKeeper from payroll tax
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  • Maja Garaca Djurdjevic
  • May 07, 2020
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The exemption is forecast to save businesses up to $360 million over six months, as Queensland moves to align itself with the other states after Victoria announced on Monday a further $491 million in tax relief to help save businesses and jobs.

Applauding the state government’s move, CCIQ general manager of advocacy and policy Amanda Rohan said it gives businesses security to keep people in jobs and confidence when planning for recovery.

“The Jobkeeper Payment is designed to support businesses to keep people in jobs. Imposing additional tax on them for doing that, keeping people employed, would have been counterproductive,” said Ms Rohan.

“This exemption will go some way in supporting business to continue to operate by giving them certainty on knowing what their upcoming bills are and so they can accurately plan their next steps.”

Earlier this week, the Victorian government said will provide a further $491 million in tax relief to freeze a host of fees, charges and levies to reduce the financial burden on households and businesses, workers and families through the coronavirus crisis.

The announcement means the $1,500 fortnightly payment paid to staff who are currently stood down will be free from all state government taxes and charges.

Moreover, payments above a part-time employee’s usual salary, due to JobKeeper being a minimum $1500 fortnightly payment, will also be exempt from payroll tax and the WorkCover premium.

“These changes will help businesses, save jobs and reduce the burden on households hit hard by coronavirus,” said Treasurer Tim Pallas.

The Victorian government noted it will also freeze all fees and fines that were due to be increased in July at current levels – including car registration, traffic infringements, court-imposed penalties and permit fees.

South Australia and Western Australia were among the first to exempt JobKeeper payments from payroll tax in early April.

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